Strategic Quality Cost Management Research On China's Food Industry

Quality cost is a historical product of market economy evolution when it develops to a certain stage, which arises from the development of combination of quality management and cost management. The research of quality cost aims to obtain a better understanding of its formation history so as to explore the future progresses trend. Fundamentally speaking, the basic obligation of corporation management is to pursue quality improvement constantly and to win the market share gradually in the interest of creating benefits for the company. As a matter of fact, effective quality improvement always means the increase of cost, and will inevitably bring about difficulties to the production process. The objective of traditional management is decision elections between quality and cost, which is called comparative decision-making. However, the examples of successful companies around the world indicate that comparative decision-making is not the optimal executing program. Comparative decision-making will undoubtedly result in a insular analysis of quality and cost although it realizes cost control to a certain degree. A problem should be paid more intention is that the failure of cost management, which refers to quality indexes fail to meet relevant standards, will produce more extra quality cost and pose a negative impact on the corporate credibility. It is obvious that effective control of cost and expense is the key factor to succeed for enterprises participating in market competition on the basis of ensuring a certain quality level. Quality management focuses on quality improvement while cost management emphasizes cost deduction. Quality cost management attaches great importance on the integrative consideration of quality, cost, and economic benefits. Domestic researchers have carried out abundant investigations as regards to corporations in different industries, which promote the development of quality cost management and create considerable benefits to enterprises. Owing to the lack of strategic considerations on quality cost management, most enterprises encounter operating problems when facing international competitions. In consideration of this, the concept of strategic quality-cost management is introduced in the academic field.The theory of strategic quality cost management lead a shock to the traditional quality cost management. The effective implement of strategic quality-cost management will provide the companies in food industry as well as other relevant industries with core competitiveness so as to enhance their economic efficiency when participating the international competitions. Therefore, the research of strategic quality cost management is prerequisite to the investigation of total quality management and financial cost management in food industry. This paper is mainly focuses on the theoretic study of strategic quality cost management in a strategic point of view, that is to say, cost management will be conducted from the viewpoint of economy and value. Also, the expenditure of quality preventive and quality identification, together with losses (including explicit losses and implicit losses) arising from the failure of quality cost management, are considered in this paper and the quality cost report is supposed to completed in my research. Document retrieval method, standardized research method, graphical mathematics analysis, and the comparative analyzing technique are introduced in my research. The contexts of this paper are divided into four segments. The first chapter is introduction which includes literature review, research value, and research ideas. The second chapter carried out investigations as regards to quality cost management theory. Based on the formation history of quality cost management, the concept of strategic quality cost management is put forward through the discussion of traditional quality cost management. Third chapter analyzes the current status of quality cost management concretely in Chinese food industry and points out a great deal of problems which rises due to quality defects. The fourth chapter is mainly about the strategies of strategic quality cost management which is called "Dairy competition weight" in this paper. By using the analyzing method of exponential function, optimal quality cost model is acquired though the adoption of quality cost management theory and the future development is explored as well. More importantly, strategic quality cost management system with great realistic values and practical operating performance is achieved which will guide the future progresses in Chinese food industry as a benchmark.This paper is divided into four main chapters in which techniques such as document retrieval method, standardized research measure, comparative analysis and graphical analyzing method are employed. Primary researches are summarized as follows:(1)Introduction of this paper is presented in the first chapter which includes the topic values, researching ideas, central contents, etc. First of all, quality crisis of food industry in recent years are reviewed in which the so-called "2008 great earthquake of Chinese domestic dairy industry" is remarkable. The "Melamine Incident" has warned us the significance of dairy quality and made us pay more attention to the investigations of quality cost management in China's food industry. On the current researching literatures, specific studies as to the food field are relatively small although there are abundant researches on quality cost management. Therefore, discussions on quality cost management of China's food industry are indispensable. In the latter part, we set out the topics of this article and research motives as well. We also put forward a brief description of the content.(2)The second chapter carries out the theoretical researches on quality cost management. In this part, the formation history and development process of quality cost management are concretely stated. Furthermore, the definition of strategic quality cost management and classifications are presented. Based on these discussions, we conclude that strategic quality cost management represents the further research direction.(3) The third chapter launched a detailed analysis and discussion on the researching actuality of strategic quality cost management and points out once again that the essential causes of diary quality problems attribute to the deficient studies with respect to external invisible quality cost. Moreover, due to the failure of implementing quality cost management effectively, enterprises gradually find it difficult to obtain competitive advantages in a customer-oriented market and always have to suffer a huge loss of quality cost.(4)The fourth chapter is entitled "Strategic quality cost management strategies—dairy competition weight", which expands the specific research to diary field. On the basis of quality crisis in China's food industry, we proposed a detailed description and settings concerning strategic quality cost management through the combination of quality management theories and dairy crisis reality. What is more, we also build the optimal quality cost model with exponential functions and geometrical analyzing methods. Based on the analysis of optimal model, we put forward the strategic quality cost management system which aims to guide the investigations of quality crisis solution in China's food industry. The innovation point of this paper is that we re-definite the concept of quality cost by considering the implicit quality cost and long-term losses together and make modest improvements on traditional quality cost model successfully.