How companies use the information about quality related costs

Abstract

This work focuses on the broad topic of quality related costs (QRC), which has been largely discussed in the literature. Nevertheless, one of the least studied issues relates to the way companies use QRC information. In this research the profile of use of QRC information is analyzed considering the model proposed by Simons (1991), from which it is possible to distinguish between a diagnostic and an interactive profile of use. The analysis of the data collected through a questionnaire survey to a sample of Portuguese certified companies (PCCs) involved the application of factor analysis, cluster analysis, one-way ANOVA and discriminant analysis. The results showed that a substantial part of PCCs use the QRC information according to a diagnostic and interactive profile. Managers of these companies use QRC information to set goals, monitor their implementation and motivate participants (according to a diagnostic profile), but also to foster organizational learning, the emergence of new ideas and strategies (according to an interactive profile). About 30% of companies favor a diagnostic profile. However, about 32% of companies report negative values for both profiles, indicating that these companies undertake initiatives to prepare QRC information but their leaders do not use it in the management process.