Marketing

Different Types of Standards in Performance Measurement

Fixing up standards for products requires careful planning. Standards are fixed taking into consideration the process involved, the nature of the product, consumer demand, etc. Selection of wrong standards will end up in premature death of the product in the market. While fixing the standard, the following physical properties of the product are considered :

  • Basic weight and measures,
  • Size, shape and dimension,
  • Chemical or technical properties,
  • Product performance,
  • Quantity of units for sale or handling, and
  • Other characteristics apparent to human senses.

Fixing a standard for a product is, therefore, purely a technical function to be handled by managements with vision and foresight. According to F.L. Clark, ‘standardization includes the establishment of standard, the sorting and grading- of products to conform to these standards, repacking, breaking up larger quantities into smaller units of desirable size and product inspection.’ Standardization includes various elements such as Grading, Packaging, Labeling, Branding, etc.

Types of Standards in Performance Measurement

1. Product Standards. They establish ingredients, physical characteristics, quality and performance of a particular product. These standards are essentially technical descriptions and are made known to buyers. Product standards generally help the consumer by assuring him of uniformity in quality and performance.

2. Engineering Standards. These standards are concerned directly with the parts that make up the product. A company making several similar products may standardize the products and equipment that help in production.

3. Material Standards. The materials that are used in production (raw materials) are standardized in quality and other physical aspects.

4. Quantity Standards. The economical quantity to be product is decided earlier and this assumes the standard for production.

5. Process Standards. The operation method standardized to get the ma)c min benefit of ease and in a factory or industry is cheapness in production.

6. Equipment Standards. Equipment used (e.g., material handling, packing, etc.) are also standardized.

7. Safety Standards. This refers to rules and regulations formed to assure the safety of men and machines working in a factory.

8. Administrative Standards. The office methods and procedures are standardized to assure a most efficient working.

Standardization and Simplification

These two terms are often used interchangeably. Simplification refers to lines of products and manufacturing procedure, whereas standardization is concerned principally with a particular product or process. Simplification also means elimination of unnecessary types, sizes and grades of products. Standardization, on the other hand, concentrates upon the optimum number of types, sizes and grades of products. To be more specific, simplification is commercial in nature, while standardization is technical.

This could be well illustrated by the following example: When a manufacturer of electric fans reduces his line of electric fans from six models to two, he has simplified his product line. When the same manufacturer establishes for each model a modified and new regulator or any additional special features he is said to have established standards for the products. Maintaining the Standard Standardization is a continuous process and the success depends or maintaining it systematically. If standards are registered, the manufacturer is obliged to maintain them.

The ISI inspectors throughout the country draw samples from various places and these are later tested in Laboratories to find out their conformity with the standards. Besides the legal obligation, a manufacturer is bound to maintain the standard, or he will fail in a competitive market. Most of the manufacturers have their own Quality Control Departments and keeping the standard of the final product is their responsibility. Modern management uses techniques like Statistical Quality Control to ensure standards.

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