costofquality 02
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mba presentationTRANSCRIPT
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PREPARED BY,
Ajay kurien
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The “cost of quality” isn’t the price of creating
a quality product or service. It’s the cost of
NOT creating a quality product or service.
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Every time work is redone, the cost of quality
increases. Obvious examples include:
The reworking of a manufactured item.
The retesting of an assembly.
The rebuilding of a tool.
The correction of a bank statement.
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The cost of quality is generally classified into
four categories:
1.External Failure Cost
2. Internal Failure Cost
3. Inspection (appraisal) Cost
4. Prevention Cost
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Cost associated with defects found after the
customer receives the product or service.
Example: Processing customer complaints,
customer returns, warranty claims.
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Cost associated with defects found before the
customer receives the product or service.
Example: Scrap, rework, re-inspection,
material review, material downgrades.
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Cost incurred to determine the degree of
conformance to quality requirements
(measuring, evaluating or auditing).
Example: Inspection, testing, process or
service audits.
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Cost incurred to prevent poor quality.
Example: New product review, quality
planning, supplier surveys, process reviews,
quality improvement teams, education and
training.
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