COST OF QUALITY

Cost Of Quality

Cost of Quality

Thesis Statement

Improving value is advised by numerous to be the best way to enhance clientele approval, to decrease constructing charges and to boost productivity. Any serious attempt to improve quality must take into account the costs associated with the achieving quality, since nowadays it does not suffice to meet customer requirements, it must be done at the lowest possible cost as well.

Introduction

Quality costs are the cost of appraising a product for conformance to design requirements and to market specifications, the cost due to failure to meet requirements, the cost of preventing failures Companies rarely have a realistic idea of how much profit they are losing through poor quality. Smaller firms most often do not even any quality budget and do not attempt to monitor quality costs.

Body: Discussion and Analysis

Quality can be defined as the totality of understanding and implementing the features and characteristics of a product or services required to satisfy the stated and implied needs of the customer for now as well as the future. Many business talks about exceeding customer expectations but does this perception match in reality? What shapes and molds effective business is when you have a continually improving quality environment with total involvement of everyone in the organization that produces a total quality experience for the customer. The notion that quality is not negotiable goes without saying. An order contract/customer which is lost due to non conforming product or poor quality of service is not as easy to get back had the contract/customer been lost to price or other things. It's stated that a customer lost to poor quality is a customer you may never get back.

The true cost of poor quality is a multiple of what your measurable direct rework cost. When errors and waste, inefficiency, rework are reduced, substantial productivity increase take place.

This paper will discuss the possible reduction of quality losses are held back by a lack of awareness that losses exist. The first thing needed in improving quality is a precise grasp of existing losses. Quality improvement can only commence once quality losses has been recognized, the desire to reduce them has arisen, and people acknowledge their responsibility for doing so. Business must learn that the organization will never rise above the level of its people and leadership. It's a crock pot process not a microwave. Quality is not fast it takes time.

The cost of quality is the cost of everything the company does in trying to achieve 100% customer satisfaction. Cost of quality is made up of cost errors, inefficiency, waste and rework. Cost of quality can be broken down into three elements (Prevention, Appraisal and Failure). Prevention cost is everything the company does to prevent error waste, delays and failures. Appraisal cost is everything the company spends to check that the routine prevention measure has taken place. The cost of prevention appraisal often referred as cost of conformance, this includes all cost deliberately incurred by the company in an effort to ...