Question

in material management, what is standardization? include )at least)7 examples of standardized systems/devices utilized by businesses that you know of. Standardization is very crucial, why? (pls expand)

Answer 1

Standardization in Material Management

Definition:

Standardization is setting up a pre-defined process for creation/manufacturing of goods or service, which is generally designed based on consensus from relevant parties of the industry. The presetted standards assist in maintaining consistency in the quality and form of product and services to be produced.

Importance of Standardization (Why it's Crucial):

• Standardization in manufacturing processes ensures that the customer gets similar products across the globe irrespective of physical location of the store from where the product is bought.
• Standardization enables the company to have more then one manufacturer as supplier of materials as the standards are preset.
• This further assists in better availability of products and at a better price and delivery services.
• Standardization reduces the purchase efforts and lessens the scenarios of lesser stock or more obsolete items.
• Standardization is known for reducing inspection efforts considerably. For instance many companies do not inspect routine items that bear ISI marks.
• Standardization in the long run ensures optimum utilization of resources and reduces customer complaints or instances of returns/refunds.

Examples of standardized systems/devices utilized by businesses:

1. Presence of ISI mark on industrial products manufactured in India as a standards-compliance mark which certifies that the product conforms to all Indian standard (IS) as designed by Bureau of Indian Standards (BIS)
2. Adherence to International agency standards by several production and manufacturing companies which ensures that the products are of similar category and specifications across the facilities of the company. For example participation of wood industries in international standards.
3. Standardization utilized by Fast food or coffee/tea franchises which have detailed processes documented with the company. This ensures that a burger or a cup of coffee is prepared exactly in the same manner across the globe and tastes similar in all the outlets..
4. Standardization in marketing processes to ensure international uniformity in brand image of a company among varying markets. For instance Coca-Cola Company uses standardization in marketing processes globally by keeping the appearance of products and design themes identical in different markets. The marketing team of Coca-Cola also maintains a consistent theme in advertisements to reinforce the same Brand image globally.
5. Adherence to generally accepted accounting principles (GAAP) by all the companies listed on U.S. stock exchanges.
6. Introduction of GST by Indian Government which is a standard taxing system to be followed across the nation.
7. Implementation of JIG Standard to ensure maintenance of identical aviation fuel quality from its point of manufacturing till delivery to the airports.