What is the relationship between quality & productivity

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gsenviro | College Teacher | (Level 1) Educator Emeritus

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Productivity can be defined as the ratio of total output to total input (raw materials, man-hours, capital cost, etc.). Quality is a measure of excellence and can be defined as the overall performance (reliability, durability, serviceability, etc. ) as compared to customer expectations. There is a positive correlation between the two in any business environment. 

Better quality sets the product apart and increases sales. It also results in lesser defects, increases production efficiency, reduces replacement/repair costs and increases overall customer satisfaction. The decrease in defects and repair costs decreases the input cost and increases the overall productivity. In fact, better quality serves as the best advertisement (through word-of-mouth advertising by satisfied customers) and decreases the cost incurred in sales/marketing. In manufacturing industry, quality can also be enhanced by use of computers and machines (instead of manual operation). In such a manufacturing environment, standardization and precision will likely reduce production time and defects and enhance productivity.

The exception to this positive correlation would be in the case of more time and resources spent in quality production, esp. in manual production. 

Hope this helps.

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