Basic Business Cents
Customers are assets that must be protected. It is costly, disruptive, and time consuming to find replacements if we have lost them because of defective products or services. A literature search will find books that say it costs five times as much to win back a lost customer as it is to get a new one and another book that says that is a myth. Whatever, most businesses do not want to lose good customers and therefore must identify and correct defects that cause customer dissatisfaction.
This subject is sensitive to me at present because of an experience last month. I was in the middle of a project when my printer failed. This was the third printer from this manufacturer that failed for me in the last nine years. It was only one year old and under warranty for two more years. After considerable time spent troubleshooting on my own and four hours with the manufacturer’s tech support, I was told the faulty parts were not covered by warranty and I would have to call another number to purchase the parts. I got out a competitor’s portable printer that I had not used in 15 years and it worked with only the replacement of a single ink cartridge and allowed me to finish my project. Guess which brand I bought to replace the office printer. This was a product defect compounded by service defects. I may not be an important lost customer to them, but how many others are having similar experiences?
Defects have long-term costs and need to be studied in order to find causes and eliminate or reduce them. Defects are caused by variation in the work processes. This variation can usually be categorized into four areas:
- Variation in the method employed to produce or servicing the customer.
- Variation in material employed possibly brought on by different suppliers
- Variation in machines used, for example, different machines used or tool wear in he same machines
- Variation in methods of detections or inspection. Yes, sometimes good products are thrown away by faulty inspection processes as well as defects passed.
There is variation in every process but not all cause quality defects in the same degree. They can be grouped into two categories, vital few and trivial many. By studying the causes of variation, the important few that result in defects to the customer can be identified and action taken to eliminate them. Experience and intuition can be helpful in diagnosing the variation causes, but limited. It is better to find the true causes of the variation causing the critical defects by examining the data with the use of statistical tools.
It has become common to provide statistical methods to engineers but it is most effective if all employees, management and entry-level workers alike, are taught the methods to improve their work by analyzing the data statistically. Depending on their positions, the training ranges from 16 to 160 hours in duration.
Defectives are caused by variations. If these variations are reduced, defectives will certainly decrease. This is a simple, strong principle, which holds regardless of types of products or service produced. This will allow us to keep desired customers while adding new ones and enabling the business to grow and prosper.