Acceptable Quality Level

CIOP is an end-to-end supply chain certification program that focuses on practical aspects in addition to the theoretical concepts. For example, a typical supply chain certification may teach what is cycle counting and how to do the ABC classification. CIOP starts with these fundamental concepts and goes on to teach the participants to develop the cycle counting policy of an organisation, 10+ criteria used in ABC classification, multi-criteria ABC classification and cycle counting best practices to increase the efficiency and effectiveness. In case of CIOP, you learn the concepts and will be ready to implement in your day-to-day job in supply chain. The pedagogy is structured such a way that all the concepts are explained with industry examples, which makes CIOP as the preferred training and certification program for supply chain within the industry.

There are four main objectives of an enterprise in relation to its Acceptable Quality Management (QRM). 

The four objectives of QRM are Product, Process, Resource and Cost. An important aspect of QRM is that it aims to create a high quality product or service and to reduce the risk associated with poor quality products. Examples of acceptable products under the QRM concept are: low-end product, commonly used items, established brands and standardized versions of previously owned items. Under the concept of QRM, quality control is continuous throughout the production process. Examples of processes that can be considered as QRM-like activities are product planning, inventory management, product ordering, resource allocation, and product returns.

An essential aspect of QRM is to first identify quality issues and then solve them. A QRM strategy should be aligned with the needs of the customer. For example, if a business is developing a new product based on statistical data from a recent survey, it should first solve a problem related to quality before creating a product based on statistical data. It should then test and retest the new product until it meets or exceeds the acceptable level. A QRM objective is also to create a high-quality product by reducing defects and increasing the reliability of the product.

The third objective of a QTM is to maintain adequate levels of inventory to meet future demand. Establishing an inventory level that is too high will result in reduced quality, waste of resources, and inadequate pricing for that inventory. On the other hand, establishing too low a level will have the reverse effect and have the opposite effect; i.e., insufficient inventory to meet current demand, increased costs, and inadequate profitability. Finally, to ensure that inventory levels are maintained at acceptable levels, most companies employ the concept of part inventory distribution.

Related Articles

Acceptance Quality Limit (AQL)
Acceptable Quality Level - Explained
How do I determine the right sample size and acceptance number?
What Is Acceptable Quality Level (AQL)?
What does AQL 2.5 mean ?