Give Customers as much 'Quality' as they are willing to pay for - Good strategy?

J

jaimezepeda

#1
Recently I overheard the following:
"Give the customers as much quality as they are willing to pay for."

Is this a good strategy?
What are its merits?
Does it align with established quality standards?
How would continual improvement be integrated into such a system?
What are some not-so-obvious downfalls?
Would you implement such a strategy?

Jaime
 
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E

engjane

#2
Customers – pay for something?! Who gave you that crazy idea? :bonk:

IMO, I can see a good and bad side to this statement.
It would certainly help to put the customer pressure into focus if you look at them with a dollar value but at the same time, if you have a new customer and you applied this strategy, it could end the relationship pretty quickly and shut the door to more business (was that case of me stating the obvious?!) :bonk: :bonk:

As for continual improvement, it sounds as if you’re scuppered…customers always want cost downs so therefore you’ll be running negative CI…..although, if you’re REALLY good, you could make improvements that counteract the cost down…

Where did you hear this anyway?
 
L

little__cee

#4
some merit

I initially thought this idea had some merit. My thinking was that just BECAUSE you can tweak something to the nth degree doesn't mean your customer needs that tight of a tolerance.

Example I can think of right now - I was painting boards in the garage the other night and I went and found a smaller paintbrush to paint the ends and I was being careful not to let the paint glob on the bottom side -- my husband came out, laughed, and said "I'm just going to cut those boards anyways don't paint the ends"

Silly me. I was giving the "customer" more quality than he needed (or deserved - another matter)

There are a lot of products that you pay more for because they look pretty - but if you just need something functional you pay less. Is quality REALLY that much different?

I agree if you can do it to a higher standard at the same cost go for it. If it costs you more to produce the higher standard and your customer doesn't care, would you really go that extra mile?
 

SteelMaiden

Super Moderator
Super Moderator
#5
HMMM........
First of all, I guess I need to know what the definition of "as much quality as they are willing to pay for". If you are talking about luxury items added to a car, ok. That is not really quality, but some people think the more bells and whistles a product has the better it is. I look at quality as each item having quality, and if I order more options, each should be of the highest quality. I also expect to pay for the additional options. If that is the way you look at quality I guess the strategy is simple business economics. But, I look at over-all quality of the whole, not how many gadgets were included.

So using my definition of the whole product, how do you (figurative you, not literal) decide how much it is worth to provide a quality product vs. one that is just so-so or maybe has defects? In our business some defects could cause loss of life. What price do I charge to give you defect free steel to drive your car on over a bridge? If I cannot get the price that I feel that is worth, should I send you nonconforming steel and take the chance that nothing happens?

Does it align with established quality standards? Not that I can tell. Established standards tell us we need to prevent nonconforming product from going to the customer.

Would I implement this strategy - NO!
 
J

jaimezepeda

#7
SteelMaiden said:
HMMM........
First of all, I guess I need to know what the definition of "as much quality as they are willing to pay for".
I was not given a definition. However, I did gather an example of what was meant by the statement.

For example, an organization has accpetable service level rates. Let's say 98% on time delivery. The service delivery includes a combination of commodity (nuts and bolts) and specialty items (special order items). If the organization is meeting and sometimes exceeding the acceptable service level goal (98%), why try to "add" more quality where it is not needed?

My first question was, how to accurately determine the level of quality the customer wants?
My next question was, isn't the original statement just meeting the customer requirements and doing nothing more?

Anyway, I wanted to get some responses from a broader audience than my own experience.

Thanks. Keep them coming.
Jaime
 
R

ralphsulser

#8
jaimezepeda said:
Recently I overheard the following:
"Give the customers as much quality as they are willing to pay for."

Is this a good strategy?
What are its merits?
Does it align with established quality standards?
How would continual improvement be integrated into such a system?
What are some not-so-obvious downfalls?
Would you implement such a strategy?

Jaime
I can recall an instance where the customer wanted better quality but were unwilling to pay for it. Example: We were provided tooling by the customer to make a product. The tooling was old and needed to be replaced or extensive repair. This was an FRP body part for a former major truck manufacturer. Their quality dept. issued complaints for characteristics caused by their tooling. We talked to them and stated that we both need to talk to their purchasing and engineering depts. The engineering and purchasing people said there was no money to repair/replace the tooling. Their quality standards and expectations exceeded the tooling capability. This was a cheap tool to begin with. We finally had a meeting at our plant with everyone involved, and it was decided to issue deviations. Well, the customer never got better quallity than what they paid for because of a lack of capability by their own tooling. It didn't stop their quality dept. from demanding more. Finally the model was dropped from their product line, but we had many go rounds in between.
We had other jobs with them with new, capable tooling and met quality expectations. So, it all depends on how your company tries to accomodate customers. This should have been all resolved upfront, but I guess top management wanted the additional business.
 
R

ralphsulser

#10
gpainter said:
What about meeting and exceeding the Customers expectations??
Sometimes customers have to talk among themselves to define realistic expectations based on what they (the customer) are willing to do to meet those expectations. Their responsibility in thie aforementioned case was to pony up with some $$, or relax expectations.
 
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