Introduction In the following essay, I will write about Adidas Company and will describe the relationship among its various quality costs which are failure costs, internal failure costs, external failure costs, appraisal costs and prevention costs. In addition, I will analyze the efforts the company should focus on to further improve the quality of its products/services. Therefore, this essay is divided to 3 main points which I think the company should focus to improve its quality. The first point is the prevention cost which’s the most important quality cost that the company should focus because prevention is always better than correction. The second point is to Six Sigma strategy. The last point is the Deming’s 14 points which I will only discuss about three points which I think the company needs to focus and apply.
Adidas is one of the most famous companies over the world which is considering as the biggest company in Europe and the second one in the world. Adidas is a German sports apparel manufacturer which consists of the Reebok Sportswear Company, Golf Company, and Rockport. Besides sports footwear, the company also produces other products such as bags, shirts, watches, eyewear and other sports and clothing-related goods.
Discussion on the concept of total quality cost in Adidas Company
The concept of total quality cost is the costs associated with preventing, finding, and correcting defective work. These costs in Adidas Company are huge, running at 20% - 40% of sales. Many of these costs can be significantly reduced or completely avoided. Before we go any further into total quality cost, we need to understand what is failure costs, internal failure costs, external failure costs; appraisal costs prevention costs in Adidas Company beside quality improvement.
Failure Costs in