Jan 022013
 

I was just reading a really interesting article by Matthew Littlefield called Cost of Quality Definition.  I applaud the article for several reasons.  It is straightforward, clear, and short.  I especially like that Matthew acknowledged that Cost of Quality is not only in negative things that are avoided (warranties, recalls, scrap, etc.), but also that there are costs to prevent these negative consequences (cost of appraisal and prevention).

This sounds like a trivial thing, but I remember living through the 1990’s where some academics and practitioners had a cultic obsession with quality.  They would hammer you with the idea of cost of ‘poor’ quality.   As a university student and engineer I would say, “Well, yes, but obviously you pay something to ensure good quality and avoid recalls, customer satisfaction loss, etc., right?  I mean, there is a level of quality that is not worth while attaining, because the customer does not value it and will not pay for it.”  The quality obsessed would look at me like I had just uttered vile heresy and inform me that having good quality NEVER cost the organization anything – only poor quality did.  Mr. Littlefield’s definition makes a lot more sense.

What does not make sense is Mr. Littlefield’s engaging, but definitionless graph in the article.  The axes are not labeled, either with specific financial units, or with general conceptual terms.  Furthermore, in the paragraphs before and after, his discussion is about the trade-off needed to find the minimum between Cost of Good Quality and Cost of Poor Quality… but the graph has three axes?    Maybe on axis Total Cost and the others are Cost of Good Quality and Cost of Poor Quality?

Can  someone explain?

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  4 Responses to “Cost of Quality: Defined by Equation, But Not By Graph?”

  1. Graphs on this subject by Juran & Pyzdek make much more sense to me. Examples can be seen in an excerpt here:

    http://www.qualityamerica.com/Knowledgecenter/qualitymanagement/goal_of_quality_cost_system.asp

  2. Quality should be applied were it has a defiant physical attribute and enhances the functionality of the product. All to often quality and finish / appearance is miss placed and cost incurred where not required.
    We in engineering are to blame for this, as we compete against each other to make a more ex statically better looking product. We compete finishes of products and not on functionality. A warranty is perfectly placed if you are sure your product can take the abuse your market can apply to it with in a given set of parameter. By applying quality to defiant physical attribute and enhances the functionality, you do as some have already realised give a better warranty 2 year to 7 year. This is of real tangible value to the end user.
    Therefore those in the know sacrifice quality in the right place and they don’t get confused with level of finish that may or may not be required, by the customer. Remember there is good quality in simplicity. If this is applied then cost to manufacturing is under control.

  3. Tanks, I am interesting to read Matthew’s article, then I can share the comments in respect thereof.

  4. Hello,

    Thank you for covering our blog post on the cost of quality definition. I am glad you liked the definition and equation we provided and you caught us red-handed on the image ; )

    I will update the image next week with some real benchmark data on the cost of quality…I am looking forward to see if this new image will be met with your approval.

    Best,
    Matt

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