Quality And Cost

Everybody knows that labor is the most expensive part of any process

, so why must it be so difficult for management and supervisors to look into the way the labor is used in any given process? They are always so worried about the cost of materials, which is very important, but to overlook the way labor is used and wasted, doesn't make much sense.

For instance, there is always a larger focus on the purchasing of consumables and materials used in the process to make their product. It is often unwise just to look at the bottom line per piece price of the parts. There's more often than not an advantage in looking at the total cost of the product based on what it brings to the table. Are you buying the absolute most affordable part that you can because you think that the per piece price is the ultimate gauge of how much something cost?

If you are thinking that way then you're behind the curve because any effective purchase starts with knowing all of the benefits to a product and not just how much just one purchase order needs to be written up for. The purchase order cost is only the start of the total price to utilize the product. What does the product do to save you time? Is it simpler to use, does it last longer, how does the quality factor into how many times you actually have to purchase the part?

Think about how much it cost you to cut a purchase order for the parts the first time, if you have to buy the same parts more frequently than you would another part; then are you really saving money over the long run? Maybe with a higher quality part you wouldn't have to order the parts as often, thus saving the labor involved and paperwork involved with making the purchase.

You get what you pay for and if you're always going for the absolute lowest cost per piece, then you are building a cheaper product than you initially intended to. Or you are building the inferior product that you meant to and your product will always be considered a discount product. Of course, it is up to the manufacturer on how much they want to spend on building their part and what kind of quality they want their name to be associated with, but the customers make the ultimate decision.

by: Craig Calvin

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