Free «Cost and Quality Management» Essay Sample

Introduction

The choice between quality and price is depended upon a number of factors. In some cases, people prefer low price to quality while others make preference to higher price provided they get good quality.  Cost and quality management sometimes becomes challenging for project managers. The management practice on cost of quality is a process of quantifying the absolute cost incurred in producing the anticipated quality (Bennett and Grice, 1990). The efforts applied in adding value to a certain product makes it expensive. Therefore, genuinely highly priced products are in most cases of high quality. On the other hand, low priced goods are associated with low quality. All the same, some customers tend to shy away from highly priced goods and make preference of cost to quality. Likewise, some customers would go for quality regardless of the price. Thus, this essay seeks to present an argument of the underlying factors that contribute to the customer’s choice based on either price or quality taking an example of the construction industry.

Balancing and taking into account the cost of quality is a multifaceted concept that project managers are expected to embark on. The aim is to produce products that can be disposed easily and yield returns. However, the behavior of the customer yields on matters of cost, time and quality is a challenging factor.  Theclients in the building and construction industry are basically concerned with factors of time, cost and quality. However, many of the projects in the building and construction industry are procured based on time and cost alone. Quality does not really count so much in some cases (Kale and Ardit, 2001). This is well understood because many of those control systems of project management state cost and time and ignore the key issue of quality.  The argument made is that the main failures realized with conventional methodology in the delivery of projects have been in the prolonged delays in the fixed schedules, overruns in cost, serious quality issues and the escalating number of litigation and claims linked with projects of building and construction (Shen et al, 2004).

As a way of managing and planning successful and effective projects, the factors of cost and quality must be put into consideration. These two factors are usually very helpful in attaining the interest and objectives of the client. Neglect of either of these parameters comes along with detrimental effect on the other. The aspects of behavior in management in making attempts to deal with issues facing the building and construction industry are a matter that needs to be addressed. While some people make preference to price at the expense of quality, the industry’s long term mission and goals need to be upheld (Chang and Ive, 2002). There is no empirical evidence which shows that effectiveness of the construction projects where the factors of cost and quality have been well balanced while it is very imperative to make use of them as a system of human activity.

Price and Quality

The facet of the management of building and construction projects is very much integrated in the conventional system of building procurement. Quality and price are the main feasible aims and objectives of the various esteemed customers. Some will go for quality while for others; it is the price that matters. Even though it is deemed that quality and price are put together in the management of the projects of building and construction, research has proved that there has been a bias to cost more than quality. However, there are still a number of clients who still hold firmly to the factor of quality. Cost is mainly connected with the time which will be used in the completion of the project.  If projects are completed in a timely manner, then the contractors, clients and consultants see them a success regardless of the quality in some instances. The timely delivery of projects has been greatly criticized universally. While contractors are making a commitment to provide standard products, the quality is compromised based on cost and the time required to complete the project (Rwelamila and Hall, 1995).

Well, this greed and oversight to get things done fast with low costs incurred is in most cases accompanied with disastrous tidings. Therefore, a disciplined effort of the management team is flashed into the toilet because some clients are not that patient to wait for a quality project that takes time to establish. It is part of project management to take care of the quality as well as cost (Charles and Andrew, 1990). The client making preference of low priced projects to quality in most cases is merely in business and may not be the end user of the construction. Therefore, such clients take advantage of ignorant buyers who are lured into buying cheap things at the expense of quality. Thus, many buyers in most cases buy these projects due to lack of information concerning the concepts of price and quality.

Cost

The main concern to clients in the building and construction industry is the general projects’ profitability and ultimate accountability. Cost overruns linked with delays in projects are in most cases identified as among the main factors that amount to high cost incurred in a construction. Research in modern trends inclines to the aspects of technical expertise in managing the costs on projects of construction in the achievement of the objectives of the client. There is yet no enough proof of the issue on social, political and organizational matters that are inherent in the construction costs management and the capability of the team managing the project to meet the needs of the client based on the issue of cost (Shen et al, 2004).

Quality

Looking at the client, quality could be described as one of the main components that add value in relation to money hence affecting the cost of the thing that is being sold. Total quality management is described as putting together all processes and functions in a specific organization for the main reason of ensuring a continuous development of the quality of services and goods. The ultimate goal is to yield satisfaction to the customer. Additionally, the achievement of effective quality management of projects, a number of independent drivers requires careful management (Chan et al, 2001). These are among the things that clients will tend to shy away from and end up choosing low price other than quality.

First, the provision of quality is depended on the amalgamation of the team working on the project for the main reason of having one objective and working with a common culture. Again, the management of customer’s tastes and preferences need to be taken care of. Lastly, delivering quality is not a one-sided concept but a continuous concept that takes into account various dimensions (Chan et al, 2001). All these levels of management require more investment hence adding cost to the finally completed project. The objectives of the client and the anticipated use of the project thus acts as the key determinant of the manner in which a project will follow. While cost and quality needed to be managed well to produce standard projects in the construction industry, the interests of the customers and choices have dictated otherwise.

Choice between Price and Quality

Well, the clients in the building and construction company are not realistic in terms of the expectations of quality and cost initially while the project begins. The views and perceptions of the project managers largely differ from those of the clients. Some clients are somehow confident concerning their quality and cost expectations with a big majority having the belief of these factors to be true and of paramount importance. However, not many are willing to go through the required process to attain this. There is a pessimistic perception of the authenticity of the clients’ cost and quality expectations which is held by the project managers (Tan et al, 2007).

While the project mangers exercise good control over quality which is very important as far as they are concerned, the clients’ commitment to the quality of the project is not fundamental but is depended upon many other factors. Some clients would compromise on the expected quality initially to go for a low cost-low quality project based on the available finances or changes in the market prices. While the project is at its initial stages, quality is what seems to take a center stage. However, this initial desire fades away with time. The client becomes impatient accompanied with a feeling that the project is starting to cost more than it was initially planned. At this point, the quality of the project does not matter any more. The behavior of the client towards the project suddenly changes (Chan et al, 2001).  It is more of a psychological effect than a literal choice based on cost. It culminates into this based on the factor of time.

Well, the buyer’s choice on quality and price in the building and construction is affected by a factor of time and change in the economy. A project which takes a lot of time while developing and establishing it is likely going to be compromised from the side of the client on matters of quality. However, there are some instances that the client would allow for a long term establishment on the project and emphasize on quality.  The client’s need in the process is thus paramount (Shen et al, 2004). However, a customer’s choice of quality is in most cases control by the public sector. The choice of a low quality construction due to low prices places the project at a risk of being demolished by the government’s arm. There is a required standard set by the federal government on the quality of construction that is required for a particular structure or building. These policies thus are a contributing factor of why an individual would go for quality. The fear of incurring much more cost through government policy prompts the choice of quality over low priced projects (Tan et al, 2007).

Quality and cost are directly proportional to one another. A high valued project is expected to be as a result of the additional cost of the value that has been added to the construction project. The commissioning of projects in the building and construction industry is usually carried out by the public sector. Unless there is collusion between the officers and the contractors, the client has no other option other than to go for quality. Therefore, in the building and construction industry, the client’s choice between price and quality is influenced by government regulations and policies (Vincent and Joel, 1995). The client is thus left with only one option because the project must meet the standards dictated by the public sector. The quality expectations are thus a pre-occupation in the minds of clients on the start of the project all through to its accomplishment (Chan et al, 2001).

Quality and time are two factors that the contractors are amazingly optimistic about. Well, while bidding for the project, the time of the project does not come out as part of the bid for the contractor although it is stated earlier by the client. In a similar way, the defects period of liability shown in many traditional   systems of procurement assert that the quality expectations are relatively less realistic. The pessimistic perception of the contractor of the client’s cost reality is may be described through the contractors having had to look for work in some places with high level of competition in the market. While quality seems to be a controlling point as directed by the public sector, it is relative (Waara and Brochner, 2006). Quality can be either high or low but still be of good quality. Therefore, the buyer’s choice and more especially in the building and construction industry is majorly influenced by the cost. The cost of the project comes into place more importantly than the time of establishing the project. Thus, people’s choice of either quality or price is a factor of many things as described in this essay. Fundamentally in the building and construction industry, quality is influenced and compelled by the public sector and the parties involved including the client may have little or no choice in that (Shen et al, 2004). However, based on other factors, the client can forgo some value adding activities to the project based on the amount of finances available to purchase the product. Therefore, be it cost or quality, the need of the client takes center stage in arriving at one of the options.