Question

Question 1
In your opinion, which of the four categories of cost of quality is most costly to an organization. Give reasons for your arguments.
Not less than 350 words

Answer 1

Find the answer below:

Cost of Quality:

                Cost of Quality is important in Total Quality Management. This methodology used for all organization to evaluate the quality of organizations and avoid risk (Failure) such as poor quality, poor service. It will help to improve the organizations savings and help to attain the objective. In general, cost of Quality categorized by two major factors.

· Cost of Good Quality

o Prevention Cost

o Appraisal Cost

· Cost of Bad Quality

o Internal Failures Cost

o External Failures Cost

Cost of Good Quality:

                Cost of Good quality considers providing the good products and services. It describes in the below methods.

Prevention Cost:

                These costs consider preventing from failures and try to reduce the failure count to minimum. It worked based on Quality management System and includes following process.

· Establish Product Specifications

· Set Product/Service Requirements

· Quality Planning

· New Product Development

· Quality assurance

· Training

Appraisal Cost:

                These cost help to measuring and monitoring process related to Quality. It focus external factors that is this cost related to Suppliers, Customers requirements, purchased materials. This cost included the below process.

· Purchased Material Inspections

· Process Control

· Verification

· Quality Audits

· Supplier Rating

Cost of Poor quality:

                Cost of Poor quality focuses failures and defects. It consider the below terms.

Internal Failure Costs:

                To identify the defect/failure of product service by internal, that is it will be evaluate before customer delivery. These costs occur when finding defect products and redesign the same for avoiding failures. These cost included the below process.

· Wastages (Poor Design)

· Excessive Scrap

· Rework

· Machine fault

· Failure Analysis

External Failure Costs:

                This cost is inverse of internal failures cost that is defects found once the product or services received by customers. Where quality team unable to find faults before reaching customers. These costs included the following process.

· Repair and service

· Warranty claim

· Shipping damage

· Return

· Customer Complaints

· Incorrect order and Bill of Material.

Among the four costs, all 4 were important to run the business however we need to focus costs of poor quality. Because these costs included third parties, that is customer. Primary goal of business is satisfy the customers.

In general customers expect high level service and if we fail to serve they must disappointed. And also n number of consequences happens if we deliver/produce poor quality products and it leads to affect business in different ways.

If we fail to satisfy the customer, then it creates negative opinion about company. It applies for both product and service delivery company. Finally, we could not control the cost of poor quality; it creates more problems and lead to loss of business.

Hope it is fine.