9. Cost of Quality (3 marks) The Operations Manager at Solstella Energy would like to update...

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9. Cost of Quality (3 marks) The Operations Manager at Solstella Energy would like to update their facility with some newer technology, however the accounting department is adamant that their current budget is "very tight" and that there is "no new money" for such expenditures. Specifically, the Operations Manager has researched a conveyor system that has swivels to gently direct a package with finished product (solar panel) from underneath. Solstella Energy currently has a conveyor system that "pushes" packages to their intended destination. With product packaging gradually becoming leaner for cost and environmental reasons, the Operations Manager feels that this old "push" technology is resulting in more and more damaged packages at Solstella Energy. When a package is damaged in the Solstella Energy facility and shipped out to the customer, they incur significant costs to correct this issue. The Operations Manager is confident that the investment in the new "directional" conveyor system would greatly reduce the incidence of damaged packages, but is having difficulty getting budget approval for the new equipment. Prior to approaching the accounting department for budgetary approval, the Operations Manager has asked you to prepare a clear and concise explanation of how the "cost of quality" concept can be applied to this scenario. It is hoped that your summary will help to get the expenditure approved even though "there is no new money available". 9. Cost of Quality (3 marks) The Operations Manager at Solstella Energy would like to update their facility with some newer technology, however the accounting department is adamant that their current budget is "very tight" and that there is "no new money" for such expenditures. Specifically, the Operations Manager has researched a conveyor system that has swivels to gently direct a package with finished product (solar panel) from underneath. Solstella Energy currently has a conveyor system that "pushes" packages to their intended destination. With product packaging gradually becoming leaner for cost and environmental reasons, the Operations Manager feels that this old "push" technology is resulting in more and more damaged packages at Solstella Energy. When a package is damaged in the Solstella Energy facility and shipped out to the customer, they incur significant costs to correct this issue. The Operations Manager is confident that the investment in the new "directional" conveyor system would greatly reduce the incidence of damaged packages, but is having difficulty getting budget approval for the new equipment. Prior to approaching the accounting department for budgetary approval, the Operations Manager has asked you to prepare a clear and concise explanation of how the "cost of quality" concept can be applied to this scenario. It is hoped that your summary will help to get the expenditure approved even though "there is no new money available".