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A COQ model plays an important role in the total quality cost survey. Based on the methodology of continuous quality improvement, a dynamic COQ model for different quality level is developed in this paper. A quality level is defined by Six Sigma level that can be measured by two indicators. The relationships among the four major quality costs are analyzed. Finally, the curves of total quality costs for different quality level are presented.

Moral hazard and adverse selection often exist in asymmetric information environment. In this paper, quality investment decision problem is studied under moral hazard. A basic model for quality investment level decision is developed with the supplier as a principal and the buyer as an agent. And then we regard the supplier and the buyer’s rational limitations to set up a model when the buyer’s quality evaluation and processing activities are hidden. The model is optimized and the results under different backgrounds are discussed and compared. Results show that the buyer’s quality evaluation level and processing level are mostly influenced by the supplier’s quality assurance payment. Both the supplier and the buyer choose different quality investment levels under moral hazard because of the supplier’s payment to the buyer in case of internal failure and external failure.

It remains unresolved from the literature whether benchmarking is a useful and appropriate tool for the library and information services sector. The aim of this research is to gather evidence to establish whether benchmarking provides a real and lasting benefit to library and information services.

The study investigated the long‐term effects of a benchmarking exercise on the quality level of three UK academic libraries. However, an appropriate framework for assessing the quality level of libraries is not present in the literature, and it was therefore necessary for such a framework to be developed. This article describes and provides initial characterisation of the framework developed – the Quality Maturity Model (QMM).

The evidence from the investigation showed that the two libraries which were at stage one on the QMM before the benchmarking exercise remained there; and the library which scored at the penultimate level, level four, before benchmarking, was, four years afterwards, at level five. The tentative conclusion drawn was that benchmarking may only be appropriate for organisations with a existing high level of quality maturity. Much further work is proposed.

The research provides evidence which establishes whether benchmarking provides a real and lasting benefit to library and information services.

The purpose of this paper is to provide empirical evidence for competing representations of the prevention-appraisal-failure model of quality cost.

The authors conduct regression analysis on a secondary data set to reveal relationships among total cost of quality, its components and overall quality performance.

Total cost of quality and its failure cost component are significantly lower at higher levels of quality, while the prevention and appraisal cost components are not observed to be significantly higher at higher levels of quality. The authors propose a modification to the modern representation of the prevention-appraisal-failure model.

In manufacturing, ever higher levels of quality are associated with significantly lower quality cost.

Using a large, unique data set for secondary analysis, combined with employing a high-level measure for overall quality performance, the authors provide evidence for the aggregate explanatory power of prevalent representations of the prevention-appraisal-failure cost of quality model.

The purpose of this paper is to assess and benchmark Six Sigma strategies in services sector, namely, the telecom field, by establishing tables of fallouts of non-conforming services and their associated costs along with a custom data envelopment model for benchmarking the different strategic alternatives.

Under normality assumption, process fallout in Six Sigma is around 0.002/3.4 part per million for a centered/shifted process. By introducing Six Sigma to applications in services sector, normality assumption may no longer be valid; hence, fallouts of non-normal attributes are computed for different one-sided quality levels. The associated costs of strategy deployment, fallout and transaction completion are all considered. Data envelopment analysis model is also established to benchmark the Six Sigma strategic plans. The strategies are detailed down to processes and to quality characteristics which constitute the decision-making units. The efficiency of each service unit is computed using both CCR and super efficiency models.

The amount of efforts/costs needed to reduce the variation in a service may differ according to the targeted quality level. For the same Six Sigma quality level, services demonstrate different performance/efficiencies and hence different returns. In some scenarios, moderate quality levels could present high efficiencies as compared to services of higher levels. It was also found that the required improvement is less in the case of Log-normal as compared to normal distributions at some quality levels. This observation is also noted across the presented distributions of this study (Normal, Log-normal, Exponential, Gamma and Weibull).

The deployment of Six Sigma in services is mostly found in time-related concepts such as timeliness of billing, lifetimes in reliability engineering, queueing theory, healthcare and telecommunication.

The paper contributes to the existing research by presenting an assessment model of Six Sigma strategies in services of non-normal distributions. Strategies of different quality levels present diverse efficiencies; hence, higher quality levels may not be the best alternatives in terms of the returns on investment. The computed fallout rates of the different distributions can serve as palm lines for further deployment of Six Sigma in services. Besides, the combination of optimization and Six Sigma analysis provides additional benchmarking tool of strategic plans in both manufacturing and services sector.

Typically, the budgetary requirements for executing a supplier’s process quality improvement program are often done in unstructured ways in that quality improvement managers purely use their previous experiences and pertinent historical information. In this backdrop, the purpose of this paper is to ascertain the expected cost of carrying out suppliers’ process quality improvement programs that are driven by original equipment manufacturers (OEMs).

Using inputs from experts who had prior experience executing suppliers’ quality improvement programs and employing the Bayesian theory, transition probabilities to various quality levels from an initial quality level are ascertained. Thereafter, the Markov chain concept enables the authors to determine steady-state probabilities. These steady-state probabilities in conjunction with quality level cost coefficients yield the expected cost of quality improvement programs.

The novel method devised in this research is a key contribution of the work. Furthermore, various implications related to experts’ inputs, dynamics related to Markov chain, etc., are discussed. The method is illustrated using a real life of automotive industry in India.

The research contributes to the extant literature in that a new method of determining the expected cost of quality improvement is proposed. Furthermore, the method would be of value to OEMs and suppliers wherein the quality levels at a given time are the function of quality levels in preceding period(s).

The study seeks to quantify the ability of consumer knowledge (both objective and subjective) and personal self‐confidence to moderate consumer reliance on price and country of origin (COO) when evaluating wine quality, when all intrinsic cues are experienced through sensory perceptions.

Taste testing experiments were conducted (N = 263) using unwooded chardonnay wine as stimulus, in a three (COO) × three (price) by three (acid level) conjoint analysis fractional factorial design. Specific measures were employed to quantify consumer objective knowledge, subjective knowledge and personal self‐confidence as clearly delineated constructs, in order to investigate the ability of each to moderate extrinsic cue usage.

Analysis revealed price and COO were both stronger contributors to perceptions of wine quality than taste, irrespective of knowledge (objective or subjective) or self‐confidence levels. Reliance was found to remain extremely consistent although objective product quality was manipulated to three differing levels in a controlled laboratory environment. The research clearly demonstrates that consumer belief in the price/value schema dominates quality assessment for consumers, with COO also found to be a strong influence. This is in spite of varying knowledge and self‐confidence levels.

Results show that marketers cannot assume that intrinsic product attributes, even when experienced, will be weighted and interpreted accurately by consumers – even those considered “knowledgeable”.

The research significantly advances our understanding of consumer knowledge (type and level) and their use of extrinsic cues (price and COO specifically), in relation to their respective influence in their determination of both expected and experienced quality.

The aim of this paper is to challenge the assumption that the relationship between service quality attributes and customer satisfaction follows a classic linear path. It suggests the existence of a threshold level after which the strength of the relationship between the two constructs, for some service attributes, adjusts. Depending on the type of adjustment, service attributes can be classified as satisfier or dissatisfier. Each requires a distinct managerial action.

The data were collected via self‐administered questionnaire from customers of three service industries (i.e. banking service, hairdresser service, phone service). The type of impact of nine individual service quality attributes on customer satisfaction was investigated using multiple regression models with interaction terms.

The empirical findings provide evidence for the existence of satisfiers and dissatisfiers. Satisfiers exhibit initially no relationship with satisfaction, but after the acceptable level of quality (i.e. inflection point) has been reached, become positively related. Dissatisfiers follow initially a positive relationship path with satisfaction but after the inflection point exhibit no relationship, or at best a significantly weakened one, with satisfaction. The relationship patterns were found to be service attribute as well as service type dependent.

The findings suggest that, for dissatisfiers, increasing service quality ad infinitum may not be the most prudent approach. Here, gains in satisfaction can no longer be achieved after the acceptable quality level has been reached. However, for satisfiers, service firms must leap over the threshold before gains in satisfaction can be realized. This may require large investments in quality improvements.

Reported studies on call centers emphasize efficiency and control, with possible implications for service priorities, customer orientation and service quality. However, there is little empirical research to test assumptions from the customer’s perspective. This study aimed to establish whether customers expected (predicted) low levels of service from a call center, how this level compared to the minimum level they considered adequate, and whether the perceived customer orientation of the call center was related to service quality expectations. Data were collected in Australia from two sources: end consumers (n = 289) of an insurance provider, and business customers (n = 325) of a bank. Key findings were similar for both samples. First, customers had very high levels of adequate (minimum) expectations, and adequate expectations behaved independently from predicted (forecast) expectations. Second, customer orientation was associated with predicted expectations but not adequate expectations. The paper concludes with suggestions for future research and managerial implications.

Overview All organisations are, in one sense or another, involved in operations; an activity implying transformation or transfer. The major portion of the body of knowledge concerning operations relates to production in manufacturing industry but, increasingly, similar problems are to be found confronting managers in service industry. It is only in the last decade or so that new technology, involving, in particular, the computer, has encouraged an integrated view to be taken of the total business. This has led to greater recognition being given to the strategic potential of the operations function. In order to provide greater insight into operations a number of classifications have been proposed. One of these, which places operations into categories termed factory, job shop, mass service and professional service, is examined. The elements of operations management are introduced under the headings of product, plant, process, procedures and people.