Wirtschaftsingenieurwesen und Management

Customer-Defined Quality and Quality-Based Product Portfolio A Theoretical Framework on Quality

Abstract

Xia Pan

Most of the studies on quality to date are viewpoints from management, while the economics on quality were often ignored. In this paper, we emphasize that the principle of utility is the key to understand customer-defined quality. Based on the reviews and discussions on fundamental, economic perspectives on quality, especially the references of Taguchi’s loss function and financial portfolio theory, we propose a preliminary theory and analytical framework on quality-based product portfolio.