Question

Which of the quality management tool is useful to detect overstatement and what category of cost of quality is this "inconvenience" ? In November 2012, Hyundai and Kia acknowledge overstating the gas mileage. Subsequently, they retract the claims of 27 mils per gallon to 26 miles (combined), a reduction by 3 percent. Subsequently, their dealers would check vehicle odometers to see how much more customers spent on gas than they would have if the window stickers had been accurate. Plus a 15 percent "inconvenience" bonus will then be refunded. (NY Times, 11/2/2012).

A. R-chart in companion with P-chart; Internal failure cost

B. X-chart in companion with R-chart; External failure cost

C. C-chart in companion with P-chart; External failure cost

D. P-chart in companion with X-chart; Internal failure cost

Answer 1

The X-bar and R-chart are quality management tools used to detect overstatements like Hyundai and Kia's fuel efficiency claims, and such an 'inconvenience' is categorized as an External failure cost.

Step-by-step explanation:

The quality management tool useful to detect overstatement like the fuel efficiency claims made by Hyundai and Kia is the X-bar chart (X-chart) in companion with the Range chart (R-chart). This tool is appropriate because it would monitor process performance over time to detect such deviations from claimed performance metrics. The category of cost of quality this 'inconvenience' corresponds to is External failure cost, because the cost is associated with defects that are found after the product reaches the customer. In this case, Hyundai and Kia had to compensate customers for the additional fuel costs incurred due to their overstatement of fuel efficiency, plus an additional 15% 'inconvenience' fee, representing a direct financial impact due to failure to meet quality expectations after delivery.