A research on the measurement of quality costs in the Turkish food manufacturing industry

Understanding and application of quality costs in automotive manufacturing companies in North Macedonia: empirical study

Purpose

This study aims at presenting deeper insights regarding the understanding and application of the quality costs (CoQ) in the automotive manufacturing industry. The empirical research included three general determinants: reasons for, difficulties during and benefits from implementing quality costs, as well as two specific determinants: measuring and evaluating quality cost elements.

Design/methodology/approach

The empirical research methodology employs the expert evaluation method – the Delphi method, using a survey questionnaire comprising a total of 200 questions, and answered by 9 companies.

Findings

The survey results showed that companies do recognize the reasons for implementing quality costs as a need arising from the quality management standards, the lack of knowledge of quality costs by employees and management as the biggest difficulty while the biggest benefit includes the quality costs enhance the company competitiveness. The costs competence and qualification, the quality management system costs, the costs for improvement, the production control costs, the input control costs, the new measuring and control equipment calibration costs, the costs related to scrap, repairs and product finishing are the most significant elements of the quality costs.

Research limitations/implications

This study is limited by the small number of surveyed companies from the automotive cluster.

Practical implications

The proposed quality costs model provides to the management to conceive CoQ elements as possible drivers in the improvement process of product quality. The structure and the nature of the CoQ elements is expected to advance the process of detailing the quality costs elements.

Originality/value

The novelty of this paper refers to development of a generic quality cost model, whose relevance is confirmed by the structuring of the model with elements published in literature and validating in research companies.

Practical implications of cost of quality: a systematic literature review

Purpose

The present study focuses on the cost of quality (CoQ) based on which organizations can evaluate their quality-related activities in economic terms. The purpose of the study is to identify the CoQ practical implications as well as to group them into logical themes.

Design/methodology/approach

A systematic literature review (SLR) was conducted based on well-known academic publishers, such as Emerald Insight, Elsevier/ScienceDirect, SpringerLink, Taylor & Francis, Wiley and Scopus. Sixty-seven peer-reviewed journal articles in the field of CoQ were collected, which were published between 2010 and 2019. The “affinity diagram” was applied to group the practical implications identified into logical themes.

Findings

A plethora of CoQ practical implications were identified and grouped into the following meaningful themes: benefits of CoQ measurement, effects of CoQ, business sectors measuring CoQ, factors influencing CoQ measurement, CoQ elements, future research in CoQ and the role of government.

Research limitations/implications

The limited number of the publishers and keywords used to search for the articles of interest, as well as the subjectivity of grouping the large number of the practical implications into themes are the main limitations of the present study. These limitations constitute the basis upon which future literature review studies can be designed.

Practical implications

The present study by presenting analytically and in summary (through the themes revealed) the CoQ practical implications, provides all the respective available literature in a single study for the benefit of practitioners and academics. Thus, clear and straightforward guidelines are given to practitioners with regard to CoQ issues and academics with regard to research topics of high interest.

Originality/value

No previous SLR study focusing on analyzing the practical implications of CoQ has been published so far.

The influence of cost of quality on the performance of food manufacturing companies: an empirical study

Purpose

Due to the ever-increasing competitive and complex business environments, food manufacturing companies have to maintain high-quality products while simultaneously minimizing customers' costs. Cost of quality (COQ) plays a crucial role in enhancing companies' efficiency and reducing expenditures that can contribute to companies' competitive performance. This paper investigates the underlying relationship between the level of COQ practices adoption (prevention, appraisal, internal and external failure costs) and organizational performance in Palestinian food manufacturing companies (PFMCs).

Design/methodology/approach

A quantitative research methodology using a structured questionnaire collected data from 119 PFMCs. Partial least squares structural equation modeling was used to analyze collected data.

Findings

Results indicated that COQ adoption has a significant positive effect on the organizational performance of PFMCs. Besides, prevention, external and internal failure costs were all associated with a positive impact on organizational performance of PFMCs, whereas appraisal cost did not affect organizational performance.

Originality/value

This study is considered one of the first studies to investigate COQ practices' effect on organizational performance in food manufacturing companies in a developing country context. Thus, it adds significant value to the literature responding to calls to tackle competitiveness issues in current complex business environments.

Supply chain quality management performance measurement: systematic review

Purpose

This study aims at investigating the existing knowledge in the literature on quality management performance measurement in order to identify performance measures in the field of total quality management and classify measures according to the three levels of supplier, customer and company.

Design/methodology/approach

A systematic literature review is conducted at the intersection of performance measurement and total quality management fields. Four databases including Web of Sciences, Scopus, Emerald and Google Scholar were searched up to 2018. A final sample of 24 articles was selected based on the inclusion/exclusion criteria that constitutes the knowledge base of the study.

Findings

One of the problems that many organizations face is the lack of knowledge and resources on how to evaluate, improve and manage the quality performance. Through analysis and synthesis of the literature, the study revealed the measures for assessing quality performance at three levels of supplier, customer and company.

Research limitations/implications

This study focuses only on four databases, which may have limited the number of the databases included and thus the scope of this investigation to a certain extent.

Originality/value

The present study aimed to identify and classify different performance measures through a systematic literature review framework classifying these measures into three groups. The article brings together fragmented literature from multiple studies to categorize research output regarding performance measurement of supply chain quality. The paper shows the state of the performance measurement in total quality management in supply chain.

Future research avenues of cost of quality: a systematic literature review

Purpose

The purpose of this paper is to identify the future research suggestions which have been made by several authors with regard to cost of quality (CoQ) and to group them into respective themes.

Design/methodology/approach

This study was based on a systematic literature review (SLR) of 97 peer-reviewed journal articles in the field of CoQ published in well-known academic databases, such as Emerald, Elsevier, SpringerLink, Taylor & Francis, Wiley and Scopus. The time horizon for reviewing the literature was 9 years, particularly in the period between 2010 and 2018. The “Affinity diagram” was applied to group the future research suggestions into logical themes and the “Pareto diagram” to further categorize and prioritize these themes.

Findings

A plethora of future research suggestions identified in the literature are analytically presented. Moreover, the analysis showed that the future research suggestions in the field of CoQ can be grouped under eleven meaningful themes, which are further categorized into two broad categories, meaning the vital and the useful.

Research limitations/implications

This SLR was based on only fully accessed English articles published in international, peer-reviewed journals of the selected publishers. The restricted number of keywords used and the subjectivity in applying the “affinity diagram” are also limitations of this study.

Practical implications

This paper provides insights into the future research perspectives in the field of CoQ. Thus, this analysis can serve as a resource for both researchers and practitioners to further develop this area according to the future research suggestions and the respective themes revealed.

Originality/value

To the best of the authors' knowledge, this is the first SLR presenting and analyzing the future research suggestions of CoQ.

Managing quality decisions in supply chain

Purpose

The purpose of this paper is to develop an optimization model to better allocate cost of quality (COQ) in the supply chain (SC). In addition, the paper provides a roadmap based on COQ that allocates limited given budget among the SC entities.

Design/methodology/approach

This paper presents a comprehensive SC model while introducing six different scenarios, where each scenario minimizes fixed costs and COQ of the SC.

Findings

The results showed that the highest portion of the COQ should be allocated at the retailer echelon while the lowest portion should be kept at the manufacturer echelon. The findings also presented that the retailer should always maintain the highest quality level (QL) compared to the manufacturer and supplier.

Originality/value

Considering prevention, appraisal and failure (PAF) cost model, this research defines the tradeoff among PA, F costs, QL and material flow in the SC network; no work has been published regarding integrating PAF, QL and material flow into SC modeling.

A multidimensional longitudinal meta-analysis of quality costing research

Purpose

The purpose of this paper is to examine the longitudinal evolution of quality costs measurement, depicted in 99 real data studies of the last 30 years. A meta-analysis of these articles is conducted, in order to highlight the evolution of the variables that have been used for the study of quality costing, in relation to the date of publication, business sector and geographical origin of each paper.

Design/methodology/approach

The analysis of the cost components has been conducted with the use of multiple correspondence analysis, which is a useful tool for the exploration of the interrelations among all elements, aiming at the identification of the dominant and most substantial tendencies in their structure.

Findings

The findings suggest that the level of analysis of quality costs is related to the date of publication, the business sector and the origin of each research. Furthermore, it is pointed out that the most prominent prevention costs are related to suppliers’ assurance, internal audit and new product’s design and development. Appraisal costs are mostly defined by quality audits and procurement costs, while failure costs by defect/failure analysis, low quality losses, complaint investigation and concessions and warranty claims.

Originality/value

The present paper is a longitudinal meta-analysis of 99 quality cost papers that have been published in the last 30 years. It explores the evolution of research in quality costing, not only in relation to the cost components in use, but also in terms of date of publication, business sector and geographical origin of the studies.

Quality costing and quality management maturity in Greece

Purpose

The purpose of this paper is to explore how the sophistication of a quality costing system depends on the quality management maturity (QMM) level in Food and Beverage (F&B) enterprises. Since no previous research has taken place in this area, the paper aims at analyzing the relationships between quality costing and the specific variables that define the various maturity stages.

Design/methodology/approach

A structured questionnaire was used to survey 457 F&B companies. This produced 104 usable responses (23 percent response rate). Multidimensional correspondence analysis (MCA) with hierarchical cluster analysis (HCA) were used to detect and represent underlying structures in the categorical data set and to detect possible clusters between variables.

Findings

The more mature a company’s QMM, the more emphasis they placed on appraisal quality costs and effective use of quality costs information. Prevention costs have no statistically significant connection with the level of maturity. A generalized “expensive” use of quality costing, with no focus on problematic areas and possible solutions, does not always lead to the resolution of problems.

Research limitations/implications

A complicated – and some think unfair – tax system, combined with limited cash liquidity constitutes an unstable environment for Greek companies, in which they have to survive and develop. This environment does not support quality costing, thus resulting in limited interest by company management in participating in the authors’ research. Furthermore, the Greek Uniform Chart of Accounts and the Greek Accounting Standards do not include specific quality-related accounts, making it difficult for companies to measure quality costs and for researchers to investigate the quality costing field.

Originality/value

It is the first time that QMM levels of Greek F&B companies have been reported. The research explores the characteristics that a quality costing system of Greek F&B organizations develop at the various maturity levels. The analysis uses an exploratory method – MCA – which can highlight intense correspondences of characteristics and clusters, which cannot be predicted in advance.

An exploratory analysis of quality costing in Greek F&B enterprises

Purpose

Given the fact that the Greek food and beverage (F&B) sector, along with the tourism sector, is the basis of Greek economy, the purpose of this paper is to depict the extent to which Greek F&B enterprises have embraced quality costing, as a means toward economic development and quality assurance. Since no previous research has taken place in this area, the paper aims to analyze whether the quality costing approach has been adopted, in order to achieve quality improvement and a reduction of production costs.

Design/methodology/approach

As the variables in this research are mostly nominal, and no similar work has been previously conducted in Greece, an exploratory approach is adopted, specifically multiple correspondence analysis. This approach enables the researcher not only to analyze the phenomenon in a more holistic way, but also to highlight potential issues and questions that have not been previously identified.

Findings

The research concludes that Greek F&B enterprises have not yet accepted the assumption that quality costing leads to a reduction of production costs and to quality improvement. Furthermore, a second analysis highlights that “turnover” and “ISO-HACCP systems” are the most dominant demographic variables, which have a direct relationship to prevention and internal failure costs.

Originality/value

Since the Greek F&B industry constitutes the larger “employer” of domestic manufacturing, this research sheds light on the role that quality costing plays in the development and success of the Greek F&B sector, by exploring the approach that has been adopted by F&B enterprises, as well as the economic outcome of this process.

Quality costing: a survey in Greek supermarkets using multiple correspondence analysis

Purpose

The present paper is an effort towards an integrated depiction of the quality costs of supermarkets in Greece. The purpose of the survey was to investigate to what extent the P-A-F model is used by Greek trade companies in the years of economic turmoil. Furthermore, it analyses how the quality costing process differentiates itself according to a number of demographic variables (size, number of employees, number of branches, ISO/HACCP certification).

Design/methodology/approach

The survey was conducted in 159 Greek supermarkets via a questionnaire. The method of Multiple Correspondence Analysis was successfully implemented in the process of answering the above mentioned questions.

Findings

The survey highlighted the limited use of quality costing practices among supermarkets. The way companies monitor quality costs proved to be highly dependent on their size, the economic circumstances and other variables (i.e. ISO/HACCP certification). Furthermore, our research provides evidence that prevention plus appraisal costs “balance” with failure costs at 83% of quality conformance.

Originality/value

The present study offers a first insight into the attitude of Greek supermarkets towards quality costing implementation. Moreover, it is enriched with empirical findings on the interrelations among the quality cost categories, which support and verify “the new COQ model”. Finally, given the fact that the majority of published research papers focus on quality costing in manufacturing companies, we chose to examine supermarkets, as a first attempt towards the analysis of quality costing in retail companies in Greece.