Summary: Quality Management

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• 1 Chapter 5: Competitive Advantage and Strategic Management for Performance Excellence

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• 1.1 Quality, Competitive Advantage, and the Bottom Line

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• What drives a strong competitive advantage?

  A strong competitive advantage is driven by customer wants and needs.

• What contribution does a strong competitive advantage make to a business?

  A strong competitive advantage makes a significant contribution to the success of the business.

• How does a strong competitive advantage match an organization’s resources?

  A strong competitive advantage matches the organization’s unique resources with the opportunities in the environment.

• What is a characteristic of a strong competitive advantage regarding durability?

  A strong competitive advantage is durable and lasting, and difficult for competitors to copy.

• What basis does a strong competitive advantage provide?

  A strong competitive advantage provides a basis for further improvement.

• What does a strong competitive advantage provide to the organization?

  A strong competitive advantage provides direction and motivation to the entire organization.

• What must companies with high defect rates do to reimburse customers?

  Companies with high defect rates must reimburse customers by lowering the price of their products.

• What effect does better production quality have on price and production costs?

  Better production quality increases the maximum potential price and decreases unit production costs.

• What happens to customers when poor quality producers can't lower their price enough?

  Customers are lost when poor quality producers can’t lower their price enough because wasted material increases variable production costs.

• What can be a means to achieving competitive advantage?

  A focus on quality and performance excellence can be a means to achieving competitive advantage.