Quality comes at a cost. There’s no denying that fact. But what exactly is the cost of quality?
Cost of Quality
Cost of Quality includes all the costs incurred over the life of the product (not just the project). Mathematically,
Cost of Quality = Cost of conformance + Cost of non-conformance
Cost of conformance
Cost of conformance is the cost of preventing failure. This is the money spent during the course of the project. There are two types of conformance costs,
- Time to do it right
- Destructive testing loss
Cost of non-conformance
Cost of non-conformance is the cost incurred because of failures. This is the money spent during and after the project. There are two types of non-conformance costs,
Internal failure costs
External failure costs
- Warranty work
- Lost business
Remember, to manage quality successfully, the cost of conformance should be less than cost of non-conformance.
Check more articles on Quality Management