Study On Quality Economics Analyzing Model And Its Application Based On General Quality

General Quality is "the degree to which a set of inherent characteristics fulfill requirements". The concept includes not only the degree to which the quality characteristics of a product or service itself fulfill requirements, but also the degree to which the processes, resources and reputation of an organization fulfill requirements.For a for-profit organization, quality itself is an economic issue. Quality will directly affect the organization's financial performance. Better product quality, customer will be more satisfied and organization's reputation, market share and customer price tolerance will be heightened while the quality loss will be reduced. Better process quality, fewer mistakes will occur and process efficiency will be increased while operating costs will be reduced. And vice versa.For many years, the lack of understanding on the nature of quality-fulfilling requirements-leads people consider that "higher quality means higher cost" and organization should "pursue suitable quality rather than high quality" because most of domestic awareness on Quality Economics is established on a basis of Quality in Narrow Sense (such as representing quality with the rate of qualified products) that considers quality issue with only the organization's view.In fact, high quality means neither excess of function or performance, nor excess of process capacity, but meeting requirements economically based on accurate identification and understanding of customer requirements. Awareness of this issue has become an important factor impacting on quality decision-making of an organization. Therefore, how to measure and analyze Quality Economics comprehensively by establishing an intuitionist, comprehensive and numerable linkage between quality activity and financial performance to promote quality decision-making more scientific and reliable has become an important subject currently placed in front of each quality worker.On a basis of access to an extensive literature, this thesis analyzes and expounds the signification of quality, the impact of quality on Quality Profit and Quality Cost, and the evaluation of Quality Economics, and also unpuzzles the mechanism and manner through which quality affects financial performance. Based on the concept of General Quality, this thesis promotes a practical measuring and analyzing model of Quality Economics and its application, and believes that:1) General Quality is an important factor of driver that affects the profitability of an organization. For quality, no best, but better; 2) The scale of respective part of Quality Cost will affects the total Quality Cost, but there is no lowest Quality Cost so-called; 3) Excess Quality is completely different from High Quality, Excess Quality could not take customer worth they need.View-points, analyzing models and methods presented in this thesis are intended to provide support on Quality Economics Management for an organization, and not intended to provide methods for macro researches or surveys. With the model provided, an organization could realize measuring or estimating the Quality Economics of a quality decision-making, a product or an organization, as well as how the Quality Cost and Quality Profit changes will occur when the quality fluctuation occurs. The analysis models and methods will have important theoretical significance of guidance and practical value of application for not only quality improvement project identification, but also economy evaluation of product or organization.