Quality & Cost Economics & ASQC Categories of Quality Cost

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Quality & Cost Economics & ASQC Categories of Quality Cost:

A good way of producing high-grade products is sturdy product design and effective processing technology. Nevertheless, this involves a higher cost of production. However, with a sturdy product design and effective processing technology, the cost of implementing quality control features decreases. Therefore, the sum of cost of sturdy product design and cost of effective processing technology add to total incremental cost.

Quality Costs as identified by the American Society of Quality Control (ASQC):

Cost of internal failures:

these costs are used to repair defective products before they get into the hands of the consumer. If defective products are no longer manufactured, the cost of internal failures would be zero.

Cost of external failures:

these costs are used to repair defective products after they get into the hands of the consumer. If defective products are no longer manufactured, the cost of external failures would be zero. Examples would include changes in product warranty, adjustment of compliant, returned products, and product allowances.

Cost of appraisal:

This is the cost of ensuring high-quality product development. This includes cost of inspection and testing, maintenance of quality control equipment, etc.

Cost of prevention:

This is the cost of minimizing appraisal and failure costs to a minimum. This can be achieved by quality planning and testing, stringent review of new products, process control, training and quality evaluation.

Additional Readings:

1. Objectives and Elements of Production and Operations Management
2. Basic Stages and Objectives of Planning in Production and Operations Management
3. Relationship between Process of Planning and External Agencies
4. Selecting a Manufacturing Plant Site
5. Controlling, Total Quality Control, and Deming’s 14 Points
6. Quality and Cost Economics and ASQC Categories of Quality Cost
7. Example of Multiple Activity Chart and Work Measurement
8. Japanese vs American Production and Operations Management
9. Kaizen Framework and Kaizen vs McKinsey
10. Advantages of Automation
11. Concept of Appropriate Technology
12. ‘Just in Time’ Manufacturing
13. Preventive Maintenance
14. Total Quality Management and ISO-9000
15. Inventory Control

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