IMPACT OF PRODUCT QUALITY ON SALES VOLUME IN NIGERIAN BOTTLING COMPANY

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND OF THE STUDY

Process industries in general face a continuous drive to improve their operations. This drive is enforced by global competition, (environmental) regulation and consumer demands (e.g. Mittal (2001)). A contribution to the improvement of the operations can be achieved by implementing an improved control strategy in the process aiming at increased productivity and flexibility in operations (Trystram and Courtois (2003) and decrease of product loss, increase of product quality and its regularity. Also more cost efficient operation is an important motivation for the implementation of a new control strategy. Currently, in process operations one usually measures the different process variables, such as temperature, humidity, pressure and flows, quite frequently. This allows for tight control of these process variables. The set points are determined off-line in advance and are usually constant, or, at best, manually adjusted as conditions change out of the normal. In contrast, quality variables, which are the key indictors for the performance of the overall process, are measured off-line, if measured at all, but are usually rather slow. Thus their use in control applications introduces time delays and periods where the process is not operating on specifications (Chen et al. (2003).

However, improvement of process operations with respect to product quality requirements can only be achieved by combining knowledge about both the product and the process, as e.g. for drying operation is concluded by Kerkhof (2000). This motivates the development of a control methodology that can be used to determine the most appropriate control strategy for a specific process operation. Although its results may be used to improve process operations in other industries, this thesis focuses on food processing and then especially on the class of climate controlled operations.

If a product fulfils the customer’s expectations, the customer will be pleased and consider that the product is of acceptable or even high quality. If his or her expectations are not fulfilled, the customer will consider that the product is of low quality. This means that the quality of a product may be defined as “its ability to fulfil the customer’s needs and expectations”. Quality needs to be defined firstly in terms of parameters or characteristics, which vary from product to product. For example, for a mechanical or electronic product these are performance, reliability, safety and appearance. For pharmaceutical products, parameters such as physical and chemical characteristics, medicinal effect, toxicity, taste and shelf life may be important. For a food product they will include taste, nutritional properties, texture, shelf life and so on.

Indeed, it is of these above that Crittal-Hope has quality control department to carryout full responsibility of quality control of the organization products. Quality means different thing to different people, in a layman term, quality entails some degree of excellence or superiority. Excellence or superiority is a relative word whereby what is qualified as excellence by one may not be excellence to another person. Control takes the form of meeting standard quality according to specification. The process through which we establish and meet standard is simply "control” when such process is established and applied to problems of product quality and product standardization, then it is called quality control.

1.2       THE STATEMENT OF THE PROBLEM

The study focused to find out the problems of product quality in manufacturing firm particular Crittal Hope Limited Kaduna as a case study. This is important because product quality may be seen as its kinds types features, property and degree of its goodness or excellence. However lot problems are faced by most by most manufacturing organization including Crittal-Hope Kaduna, in their products. these problems includes:- meeting the required standard, one of the problems is that the  products are not meeting required standard, if a company’s products are satisfy the customers requirement then it is necessary to establish a standard for the functional and appearance aspect of their product as well as their durability requirement. This aspect is essentially the general requirement for setting up a quality control department in order to ensure that standards are strictly maintained. Problems of meeting products specification, often times, product fail to meet the specification required by customers because of assignable causes like; defective materials used, improper setting of equipment, operational errors, manpower etc. it is not worthy of mention that it cost the some amount to produce products units problems of variation in quality of product. That product by mass production method on machine repeatedly, produces with unconsciously varying quality of the products because of lack of proper quality control in place. Emphasis should therefore, be on prevention rather then error detection. Consequently, the attainment of suitable quality depends upon appropriate human performance or behaviour when the product is being manufactured. It is a pity however that in the fact of economic depressions likes our society managers in manufacturing organization go to any length to compromise standard for their personnel and selfish interest. To ameliorate this vice, a quality control manager should be adequately remunerated so that he can perform his functions efficiently.

1.3       THE OBJECTIVES OF THE STUDY

This study is aimed at examining the impact Product Quality on organizational productivity. The specific objectives are;

1.                  To appraise the role of quality product management techniques in boosting sales volume

2.                  To examine the usefulness of the importance of quality control.

3.                  To understand the various production control problems.

4.                  To understand the impact of pricing on quality product.

1.4       STATEMENT OF HYPOTHESIS

The following hypothesis is formulated:

Ho:      Product Quality has no significant impact on organizational productivity.

Hi:       Product Quality has significant impact on organizational productivity

1.5       SIGNIFICANCE OF THE STUDY

The significance of this study cannot be overemphasized; the findings will be significant to individual customers of Crittal-Hope as it will enable the management to improve on their quality control thereby leading to high profitability. 

The study will serves as a reference for further research work by student and other academicians.

It is in partial fulfillment of the requirement for the award of Higher National Diploma (HND) in Production and Operations Management and to expand the understanding of the writer's knowledge regarding research study.

1.6       SCOPE OF THE STUDY

The study is to examine the impact of product quality on organizational productivity. The research shall be limited to only. Crittal-Hope Limited, Kaduna particular the production department of the organization. However note should be made where necessary with others soft drinks manufacturing companies or department within the sector.

1.7       LIMITATION OF THE STUDY

The following are the limitations that have been militating against the project work as constrains the constraints includes the following.

1.                  Low return rate of questionnaires.

2.                  Inability to use correct data gathering instrument due to ignorance about their availability.

3.                  Inaccessibility to research subjects.

4.                  Lack of corporation from subjects or object leading to the use of smaller than anticipated number. 

1.8       HISTORICAL BACKGROUND OF THE CASE STUDY

From its small and very humble beginning in 1958, the story of Critta-Hope goes back to 1884 when one Francis Crittall in Braintree, UK manufactured the first metal casement window. This successful, and so, in 1918, a standard range of metal windows and doors were introduced.

This range of windows and doors, which should be seen as the basic specification of today’s standard range throughout the world and was specified over the years for many types of housing schemes and buildings.

Having successfully exported its products to as many as 20 different countries including Nigeria, Crittal Windows in the UK decided to set up manufacturing units in some of these countries. One of such country was Nigeria, in the form of Crittal-Hope, Nigeria Limited.

Crittall-Hope has factories in Lagos and Kaduna. These factories manufacture a wide range of steel and Aluminium products such as:

Steel Products

·                     Standard Window and Doors.

·                     Projected Windows and Doors.

·                     Tropical Windos and Doors.

·                     Steel Security Doors and Gates.

·                     Door Frames.

·                     Roller Shutter Doors.

·                     Collapsible Security Gates.

·                     Industrial Shelving and racking.

·                     Stainless Steel Sink.

Aluminium Products

·                     Sliding Windows and Doors.

·                     Projected/Casement Windows.

·                     Casement Doors and Swing Doors.

·                     Curtain Wailing.

·                     Office Partitioning.

·                     Semi-Head and Circular Windows.

·                     Acoustic Windows and Doors.

·                     Timber Look Like Windows.

·                     Timber look like Door.

·                     Folding Doors.

Subsidiaries

Crittall-Hope Kaduna Ltd. is a fully owned subsidiary of Crittall-Hope Nig. Ltd, established in 1963 with a view to cover the northern part of the country. The company deals in the same range of products as the parent company.

Crittall-Engineering Services is an integrated building projects company, that was conceived to provide the cutting edge in projects management through its dedicated and services such as Designing and Building, Renovation works (internal and External), various types of partitioning systems, various types of roofing systems, civil works, mechanical and electrical works, production of security gates, Internal and external wrought works.

1.9       DEFINITION OF TERMS

Deregulated Economics this refers to those economies whose political superstructure is based on capitalist ideology.

TQM is an acronym for Total Quality Management

TQM Principles refers to doing things right the first time, be customer-centered, build term work and staff empowerment.

PIMS is defined as the Profit Impact of Market Strategy, one of the first solid pieces of evidence linking TQM.

ZEST refers to good service delivery as the special emotional plus that keeps the customer coming back time and time again.

---

---