This document discusses hidden costs of quality and provides a literature review on previous studies related to measuring and analyzing quality costs. It identifies direct and hidden costs of quality and categorizes them into costs of conformance and non-conformance. The study aims to identify, measure, and quantify all hidden quality costs, like indirect and opportunity costs, across all processes and activities in a manufacturing firm to understand their impact on total quality costs and organizational performance. A methodology is outlined to collect comprehensive cost data and compare traditional quality cost analysis with one including hidden costs.
To Analyze the Use of Statistical Tool/S for Cost Effectiveness and Quality o...iosrjce
Companies can lose money because they fail to use significant opportunities to improve product
quality as well as product cost. In order to survive in a competitive market, reduce cost of product by improving
the quality and productivity of product is must for any company.
The objective of this study is to provide system/instructions and methodology to reduce cost of product by
implementing statistical tools in local plastic injection molding company. Injection molding Company deployed
some part of the “Seven Basic Tools” to improve the quality of the product used by our society and reduce cost
of the product. Companies may reluctant to their quality status and customer satisfactory status without
implementing any helping tool which may reduce cost by identifying and decreasing number of defects and
consequently improving product quality and productivity of the system/process. Statistical techniques like
“Seven Basic Statistical Tools” (SPC) provides a very valuable and cost effective way to meet these objectives.
The principle aim of this study is to train quality personnel that how to use these SPC tools and exploit these
data in Pareto analysis, control Chart, Cause & Effect Diagram and histogram analysis. The causes of nonconformity
and root causes of quality problems were specified and possible remedies were proposed to
organization to overcome their problems. Some significant Improvement was also observed after SPC
implementation in Process potential capability (Cp), Process Actual Capability (Cpk) and Defective parts per
million (DPM)
IRJET- A Study on Quality Management System and Customer Satisfaction in Cons...IRJET Journal
This document discusses quality management systems and customer satisfaction in construction companies. It begins with an abstract that outlines that quality, time, and cost are key factors in project success and customer satisfaction. It then reviews literature on quality management practices and principles in the construction industry. Several studies are discussed that examined factors like quality assurance, total quality management, and quality planning and their impact on organizational performance and customer satisfaction in construction projects. The document concludes that implementing quality management principles and practices can help construction companies improve performance and achieve higher levels of customer satisfaction.
Analysis of ship to use program stu a case study to investigate the effectiveIAEME Publication
This document analyzes the effectiveness of a supplier certification program called Ship To Use (STU) for a manufacturing company. It first reviews literature on supplier development programs and their benefits. It then describes the STU program and process for the case company. The methodology section proposes collecting supplier data from the SAP system to identify STU parts from previous and current years, and compare parts withdrawn due to quality issues to calculate STU program effectiveness. Analysis of 196 suppliers found the STU program to be 90.22% effective in maintaining supplier quality based on this metric. The study provides a method to evaluate certification program effectiveness.
There is an increasing trend in competition on the global market and this has compelled many manufacturing and service companies to revise their understanding of quality. Customers today make informed choices and patronize products and services based on their quality. There are also regulations which are established by government agencies to ensure that products and services are of expected quality that satisfies the needs of the customer. This demand from customers has triggered a need for manufacturing companies to always provide quality products to stay in competition. Provision of quality products has a cost element attached to it. The study was a case study and focused on the assessment of cost of quality and its effect on manufacturing performance. There have been several researches that have shown the relevance of cost of quality assessment in a manufacturing firm. This research looks at cost of quality with specific emphasis on the classical P-A-F (Prevention-Appraisal-Failure) cost model and tries to ascertain its effects on manufacturing performance. The study focused on Special Ice Company Limited as a case study. The study employed three categories namely, cost of prevention, cost of appraisal and cost of failure as a proxy for cost of quality on the manufacturing performance. A sample of 80 participants was randomly selected for this study. Primary data was collected and analyzed. The findings show that the cost of quality element like cost of external failure and cost of appraisal had a statistically significant impact on the manufacturing performance of the company. A semi-structured interview was also conducted with the Manager Director to further understand the posturing of the top management with regards to the study. The study recommended that the organization make a conscious effort to sensitize employees to understand the cost of quality and its implications on the manufacturing performance of the company and also appraise their production processes at all times and ensure their entire staff adhere to accepted procedures. Again, the study also recommended that top management get actively involved and make a conscious effort to incorporate the cost of quality in their decision-making process and get all staff to align and adhere to it and also pay close attention to customer complaints act on it to improve on the products.
Lean Manufacturing and employee Performance in MalysiakhalidGGG
1. The document discusses a study on the impact of lean practices on flexibility performance in Malaysia's oil and gas sector. The study aims to evaluate the impact of pull systems, setup time reduction, and continuous improvement on flexibility.
2. A survey was conducted of 230 employees across various manufacturing companies in Malaysia's automotive industry. The results of the statistical analysis found a significant positive relationship between lean practices and flexibility performance. Pull systems in particular had a moderate impact on flexibility.
3. The findings indicate that implementing lean practices can improve company performance. Managers can use the results to prioritize which lean tools to adopt based on the performance measures that are most important to their organization. However, the study had some limitations
This document provides a case study on self-assessment practices using a Total Quality Management (TQM) model in a manufacturing company in Pakistan. It discusses:
1) Conducting the first self-assessment in Pakistan of an ISO 9002 certified manufacturing company using a newly developed International Quality Award (IQA) model.
2) The company's self-assessment application showed both strengths and weaknesses in its TQM practices, indicating it was in the early stages of quality initiatives.
3) Other companies can benefit from this example by conducting their own self-assessments to identify quality strengths and weaknesses and make improvement plans.
Effect of TQM Practices on Financial Performance through Innovation Performan...IRJET Journal
1) The document examines the direct and indirect effects of total quality management (TQM) practices on financial and innovation performance in Indian manufacturing companies.
2) It identifies 13 key TQM practices based on a literature review, including leadership commitment, customer focus, supplier quality management, and continuous improvement.
3) The study measures organizational performance through financial performance and innovation performance indicators. A conceptual research framework is proposed to analyze the relationships between TQM practices and these two performance measures.
This document summarizes a study establishing a Production Operations Manual for Asia Ceramics Corporation to implement a Quality Management System. The manual aims to standardize ceramic production processes to meet customer specifications and ensure quality. Surveys and meetings were used to establish standardized procedures and work instructions in the manual. An evaluation of the manual found a favorable response. Problem identification tools like Ishikawa diagrams and Pareto analysis were used to construct the study based on Deming's quality management cycle.
To Analyze the Use of Statistical Tool/S for Cost Effectiveness and Quality o...iosrjce
Companies can lose money because they fail to use significant opportunities to improve product
quality as well as product cost. In order to survive in a competitive market, reduce cost of product by improving
the quality and productivity of product is must for any company.
The objective of this study is to provide system/instructions and methodology to reduce cost of product by
implementing statistical tools in local plastic injection molding company. Injection molding Company deployed
some part of the “Seven Basic Tools” to improve the quality of the product used by our society and reduce cost
of the product. Companies may reluctant to their quality status and customer satisfactory status without
implementing any helping tool which may reduce cost by identifying and decreasing number of defects and
consequently improving product quality and productivity of the system/process. Statistical techniques like
“Seven Basic Statistical Tools” (SPC) provides a very valuable and cost effective way to meet these objectives.
The principle aim of this study is to train quality personnel that how to use these SPC tools and exploit these
data in Pareto analysis, control Chart, Cause & Effect Diagram and histogram analysis. The causes of nonconformity
and root causes of quality problems were specified and possible remedies were proposed to
organization to overcome their problems. Some significant Improvement was also observed after SPC
implementation in Process potential capability (Cp), Process Actual Capability (Cpk) and Defective parts per
million (DPM)
IRJET- A Study on Quality Management System and Customer Satisfaction in Cons...IRJET Journal
This document discusses quality management systems and customer satisfaction in construction companies. It begins with an abstract that outlines that quality, time, and cost are key factors in project success and customer satisfaction. It then reviews literature on quality management practices and principles in the construction industry. Several studies are discussed that examined factors like quality assurance, total quality management, and quality planning and their impact on organizational performance and customer satisfaction in construction projects. The document concludes that implementing quality management principles and practices can help construction companies improve performance and achieve higher levels of customer satisfaction.
Analysis of ship to use program stu a case study to investigate the effectiveIAEME Publication
This document analyzes the effectiveness of a supplier certification program called Ship To Use (STU) for a manufacturing company. It first reviews literature on supplier development programs and their benefits. It then describes the STU program and process for the case company. The methodology section proposes collecting supplier data from the SAP system to identify STU parts from previous and current years, and compare parts withdrawn due to quality issues to calculate STU program effectiveness. Analysis of 196 suppliers found the STU program to be 90.22% effective in maintaining supplier quality based on this metric. The study provides a method to evaluate certification program effectiveness.
There is an increasing trend in competition on the global market and this has compelled many manufacturing and service companies to revise their understanding of quality. Customers today make informed choices and patronize products and services based on their quality. There are also regulations which are established by government agencies to ensure that products and services are of expected quality that satisfies the needs of the customer. This demand from customers has triggered a need for manufacturing companies to always provide quality products to stay in competition. Provision of quality products has a cost element attached to it. The study was a case study and focused on the assessment of cost of quality and its effect on manufacturing performance. There have been several researches that have shown the relevance of cost of quality assessment in a manufacturing firm. This research looks at cost of quality with specific emphasis on the classical P-A-F (Prevention-Appraisal-Failure) cost model and tries to ascertain its effects on manufacturing performance. The study focused on Special Ice Company Limited as a case study. The study employed three categories namely, cost of prevention, cost of appraisal and cost of failure as a proxy for cost of quality on the manufacturing performance. A sample of 80 participants was randomly selected for this study. Primary data was collected and analyzed. The findings show that the cost of quality element like cost of external failure and cost of appraisal had a statistically significant impact on the manufacturing performance of the company. A semi-structured interview was also conducted with the Manager Director to further understand the posturing of the top management with regards to the study. The study recommended that the organization make a conscious effort to sensitize employees to understand the cost of quality and its implications on the manufacturing performance of the company and also appraise their production processes at all times and ensure their entire staff adhere to accepted procedures. Again, the study also recommended that top management get actively involved and make a conscious effort to incorporate the cost of quality in their decision-making process and get all staff to align and adhere to it and also pay close attention to customer complaints act on it to improve on the products.
Lean Manufacturing and employee Performance in MalysiakhalidGGG
1. The document discusses a study on the impact of lean practices on flexibility performance in Malaysia's oil and gas sector. The study aims to evaluate the impact of pull systems, setup time reduction, and continuous improvement on flexibility.
2. A survey was conducted of 230 employees across various manufacturing companies in Malaysia's automotive industry. The results of the statistical analysis found a significant positive relationship between lean practices and flexibility performance. Pull systems in particular had a moderate impact on flexibility.
3. The findings indicate that implementing lean practices can improve company performance. Managers can use the results to prioritize which lean tools to adopt based on the performance measures that are most important to their organization. However, the study had some limitations
This document provides a case study on self-assessment practices using a Total Quality Management (TQM) model in a manufacturing company in Pakistan. It discusses:
1) Conducting the first self-assessment in Pakistan of an ISO 9002 certified manufacturing company using a newly developed International Quality Award (IQA) model.
2) The company's self-assessment application showed both strengths and weaknesses in its TQM practices, indicating it was in the early stages of quality initiatives.
3) Other companies can benefit from this example by conducting their own self-assessments to identify quality strengths and weaknesses and make improvement plans.
Effect of TQM Practices on Financial Performance through Innovation Performan...IRJET Journal
1) The document examines the direct and indirect effects of total quality management (TQM) practices on financial and innovation performance in Indian manufacturing companies.
2) It identifies 13 key TQM practices based on a literature review, including leadership commitment, customer focus, supplier quality management, and continuous improvement.
3) The study measures organizational performance through financial performance and innovation performance indicators. A conceptual research framework is proposed to analyze the relationships between TQM practices and these two performance measures.
This document summarizes a study establishing a Production Operations Manual for Asia Ceramics Corporation to implement a Quality Management System. The manual aims to standardize ceramic production processes to meet customer specifications and ensure quality. Surveys and meetings were used to establish standardized procedures and work instructions in the manual. An evaluation of the manual found a favorable response. Problem identification tools like Ishikawa diagrams and Pareto analysis were used to construct the study based on Deming's quality management cycle.
Quality Concepts: Evolution of Quality Control, concept change, TQM Modern concept, Quality concept in design, Review of design, Evolution of prototype. Control on Purchased Product: Procurement of various products, evaluation of supplies, capacity verification, Development of sources, procurement procedure. Manufacturing Quality: Methods and techniques for manufacture, inspection and control of product, quality in sales and services, guarantee, analysis of claims.
2011-01-01 published journal article hande yilmazHANDE YILMAZ
The document describes applying Quality Function Deployment (QFD) and Analytic Hierarchy Process (AHP) to optimize the design of a ceramic washbasin. QFD was used to determine customer needs and technical requirements through interviews. Key customer needs identified were that the basin should not splash water, be easy to clean, look good, resist bacteria/stains, prevent soap from spilling, and last a long time. AHP was then used to prioritize these customer needs by having customers provide pairwise comparisons. The results will help optimize the basin design to better meet customer wants.
Operations Management: Six sigma benchmarking of process capability analysis...FGV Brazil
Six sigma benchmarking of process capability analysis and mapping of process parameters.
Author: Jagadeesh Rajashekharaiah
Journal of Operations and Supply Chain Management
Vol 9, No 2 (2016)
FGV's Brazilian School of Public and Business Administration (EBAPE)
Abstract
Process capability analysis (PCA) is a vital step in ascertaining the quality of the output from a production process. Particularly in batch and mass production of components with specified quality characteristics, PCA helps to decide about accepting the process and later to continue with it. In this paper, the application of PCA using process capability indices is demonstrated using data from the field and benchmarked against Six Sigma as a motivation to improve to meet the global standards. Further, how the two important process parameters namely mean and the standard deviation can be monitored is illustrated with the help of what if analysis feature of Excel. Finally, the paper enables to determine the improvement efforts using simulation to act as a quick reference for decision makers. The global benchmarking in the form of Six Sigma capability of the process is expected to give valuable insight towards process improvement.
Quality introduction for Quality Management Systemroshankhetade2
The document discusses the concept of quality, providing definitions from various perspectives and approaches to defining quality. It outlines the evolution of approaches to quality, from an early focus on inspection to more modern total quality management approaches. Key developments discussed include the emergence of statistical process control in the 1930s, quality assurance programs in the 1960s, and total quality management starting in the 1980s with a focus on continuous improvement.
This document discusses the origins and evolution of total quality management (TQM). It traces TQM from its roots in quality inspection and control to more modern approaches that emphasize continuous improvement, customer focus, employee involvement, and management commitment. The key figures and principles of TQM pioneers like Deming, Juran, and Crosby are examined. The document also outlines best practices for developing and implementing a project quality plan within an organization.
Total Quality Management Benefits and Barriers in Construction IndustryDr. Amarjeet Singh
The building sector is playing an important part Major factor in any country's development. The Construct industry growth depends on Building project efficiency.
Quality is one thing Important factor in construction industry success in this paper the problems of quality definition in the construction industry are discussed, analysis potential advantages of quality implementation and considers quality barriers to Building implementation.
Many implementing obstacles. We identify recent patterns that could lead to the Invade barriers. However, the various building actors must Know that improvement is necessary for the construction industry to improve quality TQM is specifically designed to deliver excellence in customer satisfaction by continual improvement full participation of product and processes every person who is a part of dedication that product/process. It's an orchestrated approach enhancement. If implemented correctly, it will support the Company of construction to boost its efficiency.
TECHNOLOGY TRANSFER PROCESS IN PHARMACEUTICAL INDUSTRIES ( IP-2/ UNIT 2)JAYACHANDRA AKUTHOTA
The document discusses the process of technology transfer in the pharmaceutical industry, which refers to the progression of a drug from discovery to commercialization through development, clinical trials, and manufacturing. It covers the various facets, constituents, and steps of technology transfer including development, documentation, validation, and optimization required to successfully transfer a technology from research to production. Proper planning and documentation of every step of the technology transfer process is important to ensure quality and regulatory compliance.
The document provides an overview of process validation for pharmaceutical manufacturing. It defines validation as establishing documented evidence that a process will consistently produce a product meeting predetermined specifications. The objectives, types, and stages of validation are described. Key validation documentation like protocols, reports and master plans are summarized. Regulatory requirements for validation from agencies like FDA, EU, WHO and PIC/S are highlighted. The conclusion emphasizes that validation is critical for ensuring product quality and compliance.
International Journal of Computational Engineering Research (IJCER) is dedicated to protecting personal information and will make every reasonable effort to handle collected information appropriately. All information collected, as well as related requests, will be handled as carefully and efficiently as possible in accordance with IJCER standards for integrity and objectivity
International Journal of Business and Management Invention (IJBMI) is an international journal intended for professionals and researchers in all fields of Business and Management. IJBMI publishes research articles and reviews within the whole field Business and Management, new teaching methods, assessment, validation and the impact of new technologies and it will continue to provide information on the latest trends and developments in this ever-expanding subject. The publications of papers are selected through double peer reviewed to ensure originality, relevance, and readability. The articles published in our journal can be accessed online.
Application of Quality Tools to Reduce Failure Identification in an Automotiv...IJAEMSJORNAL
Quality tools utilization is a reality in several industry segments, including automotive. Its adoption comes from the business needs of more robust and reliable process, promoting actions that reduce deviations and losses related to rework, through teamwork activities and easy visualization graphic tools that reach all operation levels. This case study found the effectiveness of quality tools application on an engine factory with the target to solve issues related to identification issue and increase process traceability through a Kaizen activity, where during a discussion were utilized some quality tools such as Pareto Analysis, Ishikawa diagram, 5 Whys, 5W1H and brainstorming. As results, it was possible to reach more than 50% evolution on the engines identification inconsistencies indicator. At the end of the study, it was found too additional benefits that came from a cross-functional team with several departments from the studied factory, such as paper waste reduction and simple automation tool application within logistic process, items that align the production process to the market demand of paperless concept application and increase the process automation level.
This document discusses key concepts in quality management. It defines quality as meeting customer satisfaction through both product features and freedom from deficiencies. Total quality management (TQM) is described as an organization-wide effort to improve quality. Several quality gurus who contributed to the field are discussed, including Deming, Juran, and Crosby. The summary emphasizes the importance of continuous improvement, customer focus, and preventing defects to reduce costs.
This document outlines the steps for developing quality standards for clinical and managerial functions of healthcare services. It begins by having organizations identify high-volume, high-risk, or problem-prone functions that would benefit from quality standards. As an example, it identifies immunization services. The next steps are to identify the inputs, processes, and outcomes of the selected function, and then define quality characteristics for key elements. Finally, standards are developed by writing statements, guidelines, algorithms, or pathways to clearly define the quality characteristics. The document provides examples of applying these steps to develop quality standards for immunization services.
This document provides an overview of key principles and philosophies related to Total Quality Management (TQM). It discusses contributions from quality gurus such as Deming, Juran, Crosby, Shewhart, and Feigenbaum. Some of the key principles covered include leadership, customer satisfaction, satisfying internal and external customers/suppliers, employee involvement, and continuous improvement. The document also discusses historical perspectives on quality management and differences between conventional quality management and TQM.
Quality assurance is a wide-ranging concept covering all matters that individually or collectively influence the quality of a product. It aims to ensure that pharmaceutical products are of the quality required for their intended use. Key aspects of quality assurance include providing evidence that quality activities are being performed effectively, ensuring products meet given quality requirements, and initiating actions to dispose of non-conforming products. Quality assurance plays an important role in industries like pharmaceuticals where human safety is critical.
IJPPM (2015) Enhancing Prioritisation of Technical Attributes in QFDNicky Campbell-Allen
The document discusses enhancing the prioritization of technical attributes in quality function deployment (QFD). It proposes using permutation sampling, bootstrap sampling, and parametric bootstrap sampling of empirical QFD data to generate theoretical populations. This allows estimating confidence intervals and determining whether differences in final weights of technical attributes are statistically significant. The methods are demonstrated on a published case study, comparing results from the three sampling approaches. The paper concludes the approaches provide a robust method for identifying which technical attributes should be prioritized in product design based on customer satisfaction.
Total Quality Management Questions is a document containing 72 multiple choice questions about total quality management principles and practices. Some key topics covered include Deming's philosophy, Crosby's approach, the costs of quality, statistical process control, quality assurance, and quality control. The questions assess understanding of concepts like zero defects, continuous improvement, control charts, acceptance sampling, and the roles and responsibilities of quality professionals.
The document summarizes a research article from the International Journal of Mechanical Engineering and Technology. The article reviews quality management systems in research and development organizations. It finds that existing research primarily focuses on implementing quality principles in R&D, with little analysis of effectiveness. The article then proposes using a balanced scorecard approach to measure R&D performance across financial, customer, internal process, and innovation perspectives aligned with organizational goals. This would help evaluate quality efforts and identify areas for future research on quality management in R&D organizations.
This document provides an overview of statistical quality control. It discusses Walter Shewhart, considered the father of statistical quality control, and his development of statistical procedures and charts for controlling manufacturing processes. It also covers W. Edwards Deming and his influential 14 points program for quality management, which emphasized process improvement over inspection and the importance of management commitment to quality. The document defines statistical process control and its goal of monitoring production through various stages to help identify out-of-control processes. It notes the increased emphasis on quality control since World War II.
This document discusses quality management concepts including definitions of quality, cost of quality, quality planning, quality control, and quality improvement. It provides details on quality management frameworks like Deming's PDCA cycle, Six Sigma, and Total Quality Management. Tools for quality control like control charts, Pareto charts, and cause-effect diagrams are also explained. The document emphasizes that quality should be designed into processes from the beginning and that continuous improvement is important to reduce costs and increase customer satisfaction.
Cost of Quality (CoQ) refers to the total costs associated with maintaining quality and preventing defects. It includes the Cost of Good Quality (COGQ), such as prevention and appraisal costs, and the Cost of Poor Quality (COPQ), including internal and external failure costs. CoQ can be reduced by building quality into processes from the start to minimize defects and failures. The difference between actual product costs and costs with no defects represents the CoQ.
Quality Concepts: Evolution of Quality Control, concept change, TQM Modern concept, Quality concept in design, Review of design, Evolution of prototype. Control on Purchased Product: Procurement of various products, evaluation of supplies, capacity verification, Development of sources, procurement procedure. Manufacturing Quality: Methods and techniques for manufacture, inspection and control of product, quality in sales and services, guarantee, analysis of claims.
2011-01-01 published journal article hande yilmazHANDE YILMAZ
The document describes applying Quality Function Deployment (QFD) and Analytic Hierarchy Process (AHP) to optimize the design of a ceramic washbasin. QFD was used to determine customer needs and technical requirements through interviews. Key customer needs identified were that the basin should not splash water, be easy to clean, look good, resist bacteria/stains, prevent soap from spilling, and last a long time. AHP was then used to prioritize these customer needs by having customers provide pairwise comparisons. The results will help optimize the basin design to better meet customer wants.
Operations Management: Six sigma benchmarking of process capability analysis...FGV Brazil
Six sigma benchmarking of process capability analysis and mapping of process parameters.
Author: Jagadeesh Rajashekharaiah
Journal of Operations and Supply Chain Management
Vol 9, No 2 (2016)
FGV's Brazilian School of Public and Business Administration (EBAPE)
Abstract
Process capability analysis (PCA) is a vital step in ascertaining the quality of the output from a production process. Particularly in batch and mass production of components with specified quality characteristics, PCA helps to decide about accepting the process and later to continue with it. In this paper, the application of PCA using process capability indices is demonstrated using data from the field and benchmarked against Six Sigma as a motivation to improve to meet the global standards. Further, how the two important process parameters namely mean and the standard deviation can be monitored is illustrated with the help of what if analysis feature of Excel. Finally, the paper enables to determine the improvement efforts using simulation to act as a quick reference for decision makers. The global benchmarking in the form of Six Sigma capability of the process is expected to give valuable insight towards process improvement.
Quality introduction for Quality Management Systemroshankhetade2
The document discusses the concept of quality, providing definitions from various perspectives and approaches to defining quality. It outlines the evolution of approaches to quality, from an early focus on inspection to more modern total quality management approaches. Key developments discussed include the emergence of statistical process control in the 1930s, quality assurance programs in the 1960s, and total quality management starting in the 1980s with a focus on continuous improvement.
This document discusses the origins and evolution of total quality management (TQM). It traces TQM from its roots in quality inspection and control to more modern approaches that emphasize continuous improvement, customer focus, employee involvement, and management commitment. The key figures and principles of TQM pioneers like Deming, Juran, and Crosby are examined. The document also outlines best practices for developing and implementing a project quality plan within an organization.
Total Quality Management Benefits and Barriers in Construction IndustryDr. Amarjeet Singh
The building sector is playing an important part Major factor in any country's development. The Construct industry growth depends on Building project efficiency.
Quality is one thing Important factor in construction industry success in this paper the problems of quality definition in the construction industry are discussed, analysis potential advantages of quality implementation and considers quality barriers to Building implementation.
Many implementing obstacles. We identify recent patterns that could lead to the Invade barriers. However, the various building actors must Know that improvement is necessary for the construction industry to improve quality TQM is specifically designed to deliver excellence in customer satisfaction by continual improvement full participation of product and processes every person who is a part of dedication that product/process. It's an orchestrated approach enhancement. If implemented correctly, it will support the Company of construction to boost its efficiency.
TECHNOLOGY TRANSFER PROCESS IN PHARMACEUTICAL INDUSTRIES ( IP-2/ UNIT 2)JAYACHANDRA AKUTHOTA
The document discusses the process of technology transfer in the pharmaceutical industry, which refers to the progression of a drug from discovery to commercialization through development, clinical trials, and manufacturing. It covers the various facets, constituents, and steps of technology transfer including development, documentation, validation, and optimization required to successfully transfer a technology from research to production. Proper planning and documentation of every step of the technology transfer process is important to ensure quality and regulatory compliance.
The document provides an overview of process validation for pharmaceutical manufacturing. It defines validation as establishing documented evidence that a process will consistently produce a product meeting predetermined specifications. The objectives, types, and stages of validation are described. Key validation documentation like protocols, reports and master plans are summarized. Regulatory requirements for validation from agencies like FDA, EU, WHO and PIC/S are highlighted. The conclusion emphasizes that validation is critical for ensuring product quality and compliance.
International Journal of Computational Engineering Research (IJCER) is dedicated to protecting personal information and will make every reasonable effort to handle collected information appropriately. All information collected, as well as related requests, will be handled as carefully and efficiently as possible in accordance with IJCER standards for integrity and objectivity
International Journal of Business and Management Invention (IJBMI) is an international journal intended for professionals and researchers in all fields of Business and Management. IJBMI publishes research articles and reviews within the whole field Business and Management, new teaching methods, assessment, validation and the impact of new technologies and it will continue to provide information on the latest trends and developments in this ever-expanding subject. The publications of papers are selected through double peer reviewed to ensure originality, relevance, and readability. The articles published in our journal can be accessed online.
Application of Quality Tools to Reduce Failure Identification in an Automotiv...IJAEMSJORNAL
Quality tools utilization is a reality in several industry segments, including automotive. Its adoption comes from the business needs of more robust and reliable process, promoting actions that reduce deviations and losses related to rework, through teamwork activities and easy visualization graphic tools that reach all operation levels. This case study found the effectiveness of quality tools application on an engine factory with the target to solve issues related to identification issue and increase process traceability through a Kaizen activity, where during a discussion were utilized some quality tools such as Pareto Analysis, Ishikawa diagram, 5 Whys, 5W1H and brainstorming. As results, it was possible to reach more than 50% evolution on the engines identification inconsistencies indicator. At the end of the study, it was found too additional benefits that came from a cross-functional team with several departments from the studied factory, such as paper waste reduction and simple automation tool application within logistic process, items that align the production process to the market demand of paperless concept application and increase the process automation level.
This document discusses key concepts in quality management. It defines quality as meeting customer satisfaction through both product features and freedom from deficiencies. Total quality management (TQM) is described as an organization-wide effort to improve quality. Several quality gurus who contributed to the field are discussed, including Deming, Juran, and Crosby. The summary emphasizes the importance of continuous improvement, customer focus, and preventing defects to reduce costs.
This document outlines the steps for developing quality standards for clinical and managerial functions of healthcare services. It begins by having organizations identify high-volume, high-risk, or problem-prone functions that would benefit from quality standards. As an example, it identifies immunization services. The next steps are to identify the inputs, processes, and outcomes of the selected function, and then define quality characteristics for key elements. Finally, standards are developed by writing statements, guidelines, algorithms, or pathways to clearly define the quality characteristics. The document provides examples of applying these steps to develop quality standards for immunization services.
This document provides an overview of key principles and philosophies related to Total Quality Management (TQM). It discusses contributions from quality gurus such as Deming, Juran, Crosby, Shewhart, and Feigenbaum. Some of the key principles covered include leadership, customer satisfaction, satisfying internal and external customers/suppliers, employee involvement, and continuous improvement. The document also discusses historical perspectives on quality management and differences between conventional quality management and TQM.
Quality assurance is a wide-ranging concept covering all matters that individually or collectively influence the quality of a product. It aims to ensure that pharmaceutical products are of the quality required for their intended use. Key aspects of quality assurance include providing evidence that quality activities are being performed effectively, ensuring products meet given quality requirements, and initiating actions to dispose of non-conforming products. Quality assurance plays an important role in industries like pharmaceuticals where human safety is critical.
IJPPM (2015) Enhancing Prioritisation of Technical Attributes in QFDNicky Campbell-Allen
The document discusses enhancing the prioritization of technical attributes in quality function deployment (QFD). It proposes using permutation sampling, bootstrap sampling, and parametric bootstrap sampling of empirical QFD data to generate theoretical populations. This allows estimating confidence intervals and determining whether differences in final weights of technical attributes are statistically significant. The methods are demonstrated on a published case study, comparing results from the three sampling approaches. The paper concludes the approaches provide a robust method for identifying which technical attributes should be prioritized in product design based on customer satisfaction.
Total Quality Management Questions is a document containing 72 multiple choice questions about total quality management principles and practices. Some key topics covered include Deming's philosophy, Crosby's approach, the costs of quality, statistical process control, quality assurance, and quality control. The questions assess understanding of concepts like zero defects, continuous improvement, control charts, acceptance sampling, and the roles and responsibilities of quality professionals.
The document summarizes a research article from the International Journal of Mechanical Engineering and Technology. The article reviews quality management systems in research and development organizations. It finds that existing research primarily focuses on implementing quality principles in R&D, with little analysis of effectiveness. The article then proposes using a balanced scorecard approach to measure R&D performance across financial, customer, internal process, and innovation perspectives aligned with organizational goals. This would help evaluate quality efforts and identify areas for future research on quality management in R&D organizations.
This document provides an overview of statistical quality control. It discusses Walter Shewhart, considered the father of statistical quality control, and his development of statistical procedures and charts for controlling manufacturing processes. It also covers W. Edwards Deming and his influential 14 points program for quality management, which emphasized process improvement over inspection and the importance of management commitment to quality. The document defines statistical process control and its goal of monitoring production through various stages to help identify out-of-control processes. It notes the increased emphasis on quality control since World War II.
This document discusses quality management concepts including definitions of quality, cost of quality, quality planning, quality control, and quality improvement. It provides details on quality management frameworks like Deming's PDCA cycle, Six Sigma, and Total Quality Management. Tools for quality control like control charts, Pareto charts, and cause-effect diagrams are also explained. The document emphasizes that quality should be designed into processes from the beginning and that continuous improvement is important to reduce costs and increase customer satisfaction.
Cost of Quality (CoQ) refers to the total costs associated with maintaining quality and preventing defects. It includes the Cost of Good Quality (COGQ), such as prevention and appraisal costs, and the Cost of Poor Quality (COPQ), including internal and external failure costs. CoQ can be reduced by building quality into processes from the start to minimize defects and failures. The difference between actual product costs and costs with no defects represents the CoQ.
The document discusses the cost of poor quality in software development projects. It notes that the visible costs are small compared to the larger, less quantifiable costs represented by the bottom of the "quality iceberg". Fixing defects early in the requirements stage can be 1000 times cheaper than fixing them after launch. Common problems include poor requirements, feature creep, and unrealistic schedules. Small changes can require significant testing and documentation efforts across teams. The quality team aims to ensure a flawless experience for customers by analyzing defects, automating testing, and continually improving processes through defect analysis and baselining applications.
The document discusses the costs of quality and their categorization. It defines cost of quality as the cost of nonconformance or doing things wrong. Costs of quality are categorized as internal failure costs, external failure costs, appraisal costs, and prevention costs. Internal failure costs occur before delivery due to failures to meet requirements. External failure costs happen after delivery due to customer issues. Appraisal and prevention costs support conformance evaluation and defect reduction activities. Quantifying and analyzing quality costs can help identify opportunities to improve quality and reduce costs. Prevention is emphasized as the most effective approach.
This document discusses the different categories and types of quality costs, including:
1) Visible costs like scrap, rework, and warranty costs and hidden costs like inefficient resource use.
2) Quality costs are divided into costs of conformance (prevention and appraisal) and costs of non-conformance (internal and external failure).
3) Prevention costs focus on designing quality in from the beginning while appraisal costs check for defects. Internal failures are detected before delivery while external failures are detected after.
The document discusses cost of quality and its categories. It explains that cost of quality refers to the costs incurred to prevent non-conformance and the costs associated with poor quality. There are two main categories - costs of achieving good quality like prevention and appraisal costs, and costs of poor quality like internal and external failure costs. Measuring these costs helps identify opportunities to improve quality and reduce costs. It provides an example of measuring quality costs at a motor company over four years which showed prevention costs increasing and overall quality costs decreasing as quality improved.
Critical success factors of Total Quality Management implementation in Indian...IRJET Journal
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Quality Management System at Construction Project: A Questionnaire SurveyIJERA Editor
The best quality, time and cost are the important aspects of successful construction project which fulfills the main goal of construction industry. The quality management has to provide the environment within which related tools, techniques and procedures can be deployed effectively leading to operational success for a construction project. The role of quality management for a construction company is not an isolated activity, but intertwined with all the operational and managerial processes of the construction project. The quality management system (QMS) in construction industry refers to quality planning, quality assurance and quality control. The paper includes the outcome of the research methodology decided by authors based on interview of project participants and analysis of scrutinized interview data.
IJRET : International Journal of Research in Engineering and Technology is an international peer reviewed, online journal published by eSAT Publishing House for the enhancement of research in various disciplines of Engineering and Technology. The aim and scope of the journal is to provide an academic medium and an important reference for the advancement and dissemination of research results that support high-level learning, teaching and research in the fields of Engineering and Technology. We bring together Scientists, Academician, Field Engineers, Scholars and Students of related fields of Engineering and Technology
Total Quality Management (TQM) Practices toward Product Quality Performance: ...IOSRJBM
The purpose of this research was to test and analyze the effect of TQM practices impelementation which consists of leadership, strategic planning, customer focus, information and analysis, people management, and process management to product quality performance. The population were 108 food and beverage companies in Makassar, Indonesia. Respondents are production managers or operation managers. Sample technique which used is population sampling. Method of analysis which use both descriptive statistic and Structural Equation Modelling (SEM). Data processing uses two statistic tools i.e: IBM SPSS and AMOS 19.00. The findings of research indicate that leadership has significant effect on product quality performance, strategic planning has significant effect on product quality performance, customer focus has significant effect on product quality performance, information and analysis has significant effect on product quality performance, people management has significant effect on product quality performance, and process management has significant effect on product quality performance. Leadership factor has dominant effect on product quality performance (critical ratio = 9.760 > t-table = 1.960; and probability = 0.000 < α = 0.05).
The document describes a Total Quality Management training program that teaches attendants about TQM principles and practices. The program covers topics like quality concepts, testing, the history of TQM, globalization, visualization analysis, common misconceptions about TQM, and factors for TQM success. It also discusses ISO quality standards and provides certification.
Development of Model for Quality Costing in a Medium Scale Industry-A Case StudyIOSR Journals
Abstract: Quality c o s t s pl ay s vi tal rol e in improving productivity. These costs are typically
categorized into costs of prevention, appraisal, internal and external failure. Like other activities of
business, quality costs can be programmed, budgeted, measured and analyzed to attain the objective of
better quality at lower cost. Quality costs is the basis by which investments in quality programs may be
evaluated in terms of cost improvement , profit enhancement and other benefits for plants and companies
from these programs. The cost of quality is an increasingly important issue in the debates over quality.
There was a mistaken notion that achievement of better quality requires higher costs. It was the myth that
prevented many Indian companies to invest more on quality cost related programs. In this article the
authors made an attempt to identify the different types of quality costs in a medium scale industry because
the small and medium scale industries pay very little attention towards finding and developing a system for
knowing & optimizing the cost of achieving quality. A model is proposed to identify the different quality
costs in a medium scale industry and is further implemented. It has been found some quality costs are more critical and require greater attention.
Key words: Quality costs, Quality management, Pareto analysis, Model for optimization
Impact of Cost of Quality on Total Quality Management in Garment Industryijtsrd
There is a very much need to take a new perspective to gain a competitive advantage in this modern era of consistently increasing of competition. This has accommodated to implement quality management in RMG Ready made garment Sector. As it has much importance in maximizing the productivity and minimizing the cost of operation. But it requires spending huge cost expenses which doesn't guarantee a desired outcome. This study is taken up with the intention to evaluate the extent how cost spend on quality is advantageous to organization. To perform this study we have used some data analysis tools to analyze the collected data which were collected through survey method and discovered that evaluation of cost of poor quality will help to implement appropriate quality policy which minimize the cost and helps to reach the standard of the customer. Prof. Lakshminarayana. N | Kusuma. P ""Impact of Cost of Quality on Total Quality Management in Garment Industry"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-3 | Issue-4 , June 2019, URL: https://www.ijtsrd.com/papers/ijtsrd23857.pdf
Paper URL: https://www.ijtsrd.com/management/strategic-management/23857/impact-of-cost-of-quality-on-total-quality-management-in-garment-industry/prof-lakshminarayana-n
This document summarizes a study that explored the relationship between target costing and competitive advantage at Jordanian private universities. It found that universities have a medium level of target costing, with leadership of target selling price being the highest dimension and reducing life cycle costs being the lowest. Universities also enjoy a medium level of competitive advantages, with expanding specializations being the strongest performance and specialization costs being the weakest. The study concluded that there is a significant relationship between the dimensions of target costing and strengthening competitive advantage, and that universities should activate target costing techniques to improve competitiveness.
A Literature Review On Environmental Regulation And Policy And Quality Assura...Sara Perez
This document presents a literature review and proposes a process-oriented quality assurance model for food and beverage companies in Malaysia. The model outlines quality assurance in three sequential non-linear phases: 1) Planning/before production, 2) Design and production, and 3) Post-production and delivery. Each phase involves quality assurance procedures like checklists and templates to ensure standards are met. The goal is to integrate quality assurance practices into companies' operations through continuous improvement rather than just compliance.
Running head QUALITY TRAINING MANUAL .docxtoltonkendal
Running head: QUALITY TRAINING MANUAL 1
Quality Training Manual 13
Quality Training Manual
Felicia Jones
12/06/2016
Table of Contents
Evolution of quality management 3
Introduction 3
i. History of the quality management evolution 3
ii. Why QM is needed 4
Week 2: The Role of Leadership 5
Senior management's role in successful quality improvement programs 5
Senior management’s role in the large-scale strategic quality programs 5
Why firms should adopt the roles 5
How management should derive the metrics 6
Week 3: General Quality Strategies and Tools 7
i. Establishing customer expectations 7
ii. Designing quality in 7
iii. Defining metrics 7
iv. Mistake-proofing 7
v. Kaizen 7
vi. Six Sigma 7
Week 4: Quality Tactics and the Logistics and Supply Chain Functions 8
i. What tools are applicable internally 8
ii. What tools are applicable externally with vendors 8
Part 2: Week 5: Roll-Out 9
i. A communication plan 9
ii. Recommended sequence of steps to get personnel trained 9
iii. Stakeholders on board (e.g., the vendor base, trucking companies, warehouse personnel) 9
References 10
Evolution of quality managementIntroduction
i. History of the quality management evolution
Total quality management was started by Naval Air Systems Command in an attempt to describe the Japanese-style management approach to improving quality. Before TQM, japan would produce products that were imitations of other products but after the inception of the same, they set new standards to the production process (Nederpelt, 2012). The rest of the world soon followed the steps of japan in their processes, product and organizational production factors. The quality management as we know it today was pioneered by some of the industrial developers such as Deming, Dodge and Romin. It is definition and application occurs in the analysis of quantitative and qualitative processes, processes and economic theories. When it started back in the mid age, the focus was all about the end product but nowadays, it has evolved to include the services offered (Littlefield & Roberts, 2012).
Quality management process basically involves four main components that need to be adhered to in order to make the process successful. They include the quality planning which is the first step and includes preparing the measuring standards and desired output quality. The other steps are the quality assurance and quality control which involves measuring the actual product and comparing it with the standards put in place. Quality improvement is the last stage and involves the reconciliation of the deviations in order to make the products and services to the desired level and in most cases, it involves rectifying the process to ensure that future items conform to the standards (Nederpelt, 2012).
ii. Why QM is needed
Custome ...
The economy is developing very fast and it is becoming more competitive with each passing day as customers also become more difficult (Weckenmann and Akkasoglu, 2012). The organization has to face more fierce competitions and challenges every day. Many companies provide the same products or services for the same customers (Weckenmann, Akkasoglu and Werner, 2015). To survive on this conjuncture, they must build up their reputation based on great product quality.
Many foundational principles of quality were introduced and developed by Deming in 1986 (Wicks. A and Roethlein. C, 2009). They had quickly become essential factors in many companies’ operation. Consequently, quality management must be given more attention like an important strategy (Khaled Omar and Murgan, 2014). Many authors think that quality of products or services has a close relationship with customer satisfaction. In order to help companies control their product quality more efficiently, the concept of cost of quality (CoQ) was formed and developed continuously.
Quality cost philosophy was first described by Armand V. Feigenbaum (1956) in his book, “Total quality management”. After that, many modified definitions of CoQ had appeared. Chiadamrong (2003) said, “The cost of quality is a comprehensive system, not a piecemeal tool.” According to Chopra and Garg (2012), quality cost is the gap between actual cost and perfect cost of products or service. In general, quality cost is a useful methodology that helps companies to build trust with customers, ensure sustainable development and increase their profit.
Crandall and Julien (2010) said that The American Society of Quality (ASQ) define cost of quality as follows: “Quality costs are the total of the cost incurred by investing in the prevention of nonconformance to requirements, appraising a product or service for conformance to requirements, and failing to meet requirements. The sum of these costs represents the difference between the actual cost of a product or service and what the reduced cost would be if there were no possibility of substandard service, failure of products or defects in their manufacturing.”
This paper will provide general and in-depth information about costs of quality and its development up to the present day with two main parts. The first part will concentrate on concepts, definitions, and models of quality costs as well as how it was formed. The second part will contain real example, discussion and analysis about how CoQ concept is as relevant today as it has ever been.
A Project Report
On
PRODUCTIVITY IMPROVEMENT THROUGH TOTAL QUALITY MANAGEMENT
Submitted in partial fulfilment of requirements
For the award of the Degree of
BACHELOR OF ENGINEERING
IN
PRODUCTION ENGINEERING
By
ABHINANDAN KUMAR
Under the guidance of
Prof. KAPIL DEV PRASAD
Department of Production Engineering
DEPARTMENT OF PRODUCTION ENGINEERING
BIRLA INSTITUTE OF TECHNOLOGY, MESRA, RACHI
2014
QUALITY MANAGEMENT SYSTEM IN R&D: A CRITICAL LITERATURE REVIEWIAEME Publication
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The document discusses the Kaizen Costing System (KCS) and its potential to provide managers with strategies for reducing production costs at different stages of a product's life cycle. KCS involves continuous, incremental improvements to manufacturing processes. It was developed by Japanese firms as an alternative to traditional costing systems that focuses on non-quantifiable factors like quality and flexibility. The study examines accountants' perceptions of whether implementing KCS would lower costs in a product's introductory, minimal batch production, and maximum batch production phases through surveys. Statistical tests were used to analyze the data and determine if relationships exist between cost reduction strategies in the different phases.
An analysis incoming quality control of material in manufacturing company l...Steve Sapp
This document summarizes a thesis submitted by Low Kuan Chuen to the National Technical University of Malaysia Malacca for a Bachelor of Engineering degree. The thesis analyzes quality control of incoming materials at a manufacturing company referred to as XX Company. It aims to identify issues with incoming materials and make recommendations to improve supplier relations and quality. Data collection and analysis techniques are used like control charts, cause-and-effect diagrams, and Pareto charts to understand problems and findings are constructed to provide suggestions for future enhancement.
This document outlines the key aspects of a course on Total Quality Management (TQM). It discusses the course objectives, which are to understand TQM concepts and principles, apply statistical quality control, understand ISO certification, and apply quality concepts to maximize customer satisfaction. The document then describes the course outcomes, which are to understand TQM, illustrate TQM principles, solve quality problems using statistical process control, understand quality methodologies, and illustrate quality systems features. It proceeds to outline the topics that will be covered in each unit of the course.
Research Inventy : International Journal of Engineering and Science is published by the group of young academic and industrial researchers with 12 Issues per year. It is an online as well as print version open access journal that provides rapid publication (monthly) of articles in all areas of the subject such as: civil, mechanical, chemical, electronic and computer engineering as well as production and information technology. The Journal welcomes the submission of manuscripts that meet the general criteria of significance and scientific excellence. Papers will be published by rapid process within 20 days after acceptance and peer review process takes only 7 days. All articles published in Research Inventy will be peer-reviewed.
The document discusses strategies for quality management, including total quality management. It provides historical context on the development of quality management from the early 20th century onward. Specific strategies discussed include kaizen (continuous improvement), mistake proofing, and six sigma. The roles of senior management and use of data/metrics in quality improvement programs are also covered. Overall the document aims to define different quality management processes and tactics and discuss their importance for meeting customer expectations and reducing risks.
The study investigated the Quality Improvement Practices (QIP) of selected small medium industries (SMIs
hereafter) namely the E&E manufacturers in Malaysia. The objectives of this study are to investigate the influence of
the quality improvement practices (QIP) among Malaysian E&E manufacturers on their compliance performance.
The quality improvement level of twelve QIP; seven soft factors and five hard factors, were determined in the study.
Later, the improvement level of the QIP was compared according to the manufacturers‟ size, ownership, length of
operation, and ISO status. A quantitative research method, which involved the distribution of a set of questionnaires,
was used in the study. Another important aspect of the research is to identify relevant soft and hard factors that need
emphasis in future trainings by the QIP trainers. As the sole assessor of Product Certification compliance for the
manufacturers in Malaysia, SIRIM QAS has the data on the Malaysian manufacturers‟ compliance performances.
Based on the data, it can be concluded that Malaysian SMIs are still struggling in implementing quality improvement
practices. The data has yielded interesting findings related to the identified soft and hard factors that need further
emphasis in future trainings. The findings provided recommendations for future trainers of QIP
Development of sustainable manufacturing decision making models for SMEsSUJIT SINGH
The document outlines a research study on developing decision-making models for sustainable manufacturing in small and medium enterprises (SMEs). It discusses research background, gaps in existing literature, objectives, methods, and key findings. An empirical study was conducted to identify key performance measures for SME sustainability assessment. Two fuzzy logic-based models were developed for sustainability performance evaluation. Additionally, a novel integrated analytic hierarchy process-VIKOR method under interval-valued fuzzy environment was created for sustainable manufacturing strategy selection. Finally, a web-based expert system was built to facilitate performance assessment and strategy selection for manufacturing SMEs.
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Understanding Inductive Bias in Machine LearningSUTEJAS
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HIDDEN COSTS OF QUALITY: MEASUREMENT & ANALYSIS
1. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
DOI: 10.5121/ijmvsc.2015.6202 13
HIDDEN COSTS OF QUALITY:
MEASUREMENT & ANALYSIS
Sailaja A1
, P C Basak2
and K G Viswanadhan3
1
School of Management, Indira Gandhi National Open University (IGNOU), New Delhi,
India, 2
Former Professor of Management , Indira Gandhi National Open University
(IGNOU),
3
Principal, College of Engineering & Management, Punnapra, Kerala , India
ABSTRACT
Quality is the assurance of adherence to the customer specifications and it is a measure of excellence or a
state of being free from defects, deficiencies and significant variation from standards. Customer
specification of the product can be met by strictly adhering to the quality control measures in the
production process and can be ensured in a cost effective manner only if the quality of each and every
process in the organization is well defined and ensured without any lapses. Every activity in the supply
chain line to be critically verified to identify the quality deviations incurring additional expense or loss to
the organization. This is in line with the continual improvement principle of TQM philosophy . The cost of
quality management system acts as the most significant tool in measuring, monitoring, controlling and
decision making activities in a firm which aims on business excellence.
KEY WORDS
Quality Cost, Hidden costs, Opportunity costs, Pareto Diagram, Quality Management System.
1. INTRODUCTION
A strong control over the management of utilization of resources of all categories in a
manufacturing process becomes the demand of the day due to the high competition among the
players of the present market. The resources-man, material, machine and time-to be utilized in a
most cost effective manner to ensure the profitability of any business and at the same time no
compromise in the quality is permissible. This is the highly competitive globalized market
scenario today.
Hence management and financial accounting have an important role in the measurement and
control of the components of manufacturing costs. On the other hand quality improvement
programs for attaining continual improvements have become essential to any business
organization to thrive forward profitably with enhancement in its customer base. The question is
how to achieve both these objective without losing organizational interests. Cost of quality has
evolved as the answer to this question. Cost of quality analysis is considered as one of the most
effective management tool for gathering and analyzing the expenses in maintaining quality in a
manufacturing process and also identifies the non-value added expenses. Quality improvement
2. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
14
programs can be critically analyzed using quality costing techniques to check the merit of the
program. This helps the management to identify the areas for improvement in quality as well in
reducing wastages and hence ensure profitability.
Cost of quality or quality costs in a broader sense is the expenses incurred by an organization in
achieving and maintaining good quality as well as in managing poor quality throughout its line of
operations with an aim to attain highest level of customer satisfaction. The cost of quality analysis
triggers changes and provide proof why changes should be made. The need to improve the
financial position of an organization directly correlates with the process of making quality
improvements. Cost of poor quality will tend to zero, if every activities are performed well in
time.
Many models of quality cost analysis have been evolved since the inception of this concept by the
quality guru Dr. Joseph Juran in 1950. The classical PAF model by Feigenbaum (1956) which
distinguishes quality costs into Prevention-Appraisal-Failure categories, Process Cost Model by
Marsh and Ross (1976) classifying quality costs into cost of conformance and non-conformance
in the manufacturing processes, Opportunity Cost Model by Sandoval- Chavez (1998) with the
addition of opportunity losses to the other traditional models and the ABC-COQ integrated model
by Tsai (1998) are the prominent models among them. Many more dimensions have been added
to the quality cost analysis by researchers like Steve Elridge (2006) who has added knowledge
management concept to quality, Sower etal (2007) who has analyzed the quality cost as a measure
of system maturity with the analysis of the relationship between quality and quality costs and Ali
Uyar (2008) and Zulnadi yakup (2010) who have analyzed quality cost as money invested and
money lost.
The difficulties in implementation of a COQ system (Ming Tsung-2010), insufficiency in reports
(Lee Hoon Tye-2011), in capability of addressing intangible costs (Assissi Jaffer-2010) and non
synergy with TQM concepts (Aviora Aspinwal-2009) were addressed by many researchers.
Technological advancements in management were also effectively utilized by many researchers
in analyzing quality cost. Behdad Kiani etal (2009) designed a model for analyzing the influence
of costs of quality through a system dynamics approach. Mahanty. B (2012) developed a system
dynamics model of quality cost in a manufacturing firm with the new features like time
dependent deterioration process, formation of quality perception and market reaction. Arman
Sadreddin etal (2014) developed a Cost of Quality (COQ) model for the procurement process of
the construction industry to establish a general course of action for minimizing quality costs
which take into account not only the internal quality costs within the company, but also the costs
of its suppliers. Several different policies were designed and their effects on quality costs
investigated through System Dynamics (SD) simulation.
Mathematical modeling was effectively used by NVR Naidu (2008) for analyzing quality cost
categories. R K Sharma et al (2007) successfully applied a fuzzy approach to elicit expert opinion
regarding the importance of cost items. The information so obtained after fuzzy synthesis is used
to set up priority with respect to the processes which can provide necessary help to managers/
practitioners to invest efforts in reduction of cost of non-conformances (CONC) and optimal
allocation of resources. Liang-Hsuan Chen, Ming-Chu Weng, (2002) proposed a fuzzy
approaches to evaluate quality improvement alternatives because of its fuzzy nature. An evidence
fusion technique, namely Choquet fuzzy integral, is employed to aggregate the quality cost
3. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
15
information. Quality cost improvement model for analyzing conflicting goals using fuzzy sets
was presented by Wang, Ming-Chu et al (2010).
Lin Zhang et al (2010) developed an extended Quality Function Deployment (QFD) approach to
assess quality cost of packaging machinery from technical perspectives. Evaluation criteria for
quality assurance cost, quality loss cost and comprehensive technical requirements are introduced
for analyzing technical requirements that transform from customer needs and AHP is used to
calculate and normalize different quality requirement weights.
The behavioral patterns of various cost categories were studied by Chopra eta (2011) and Sailaja
et al (2014) using correlation and regression analysis.
Shephered (2002) made an effective approach to the identification and measurement of quality
failure costs can be integrated into a balanced score card.
But in spite of the over helming interest shown by the academic community in COQ studies, the
industrial experts all over the world is still hesitant to utilize this tool in a fully fledged mode, as
apparent from the empirical studies conducted worldwide in this regard.
Cost of quality management study from Turkish marble industry by Ozgur Akkoyun and Huseyin
Ankara (2009), Survey regarding quality cost in Romanian service industries by Mariana Glavan
et al (2009), Cost of quality practices among Indian industries by T Nath (2003), Aravind Chopra
and Dixit Garg(2012) and Paramjit Kaur (2009) , An empirical study of quality cost system
implementation in Brazilian tool manufacturing machinery by Felipe ARAÚJO
CALARGE(2007),Cost of quality studies in Malaysia (Kanapathy & M Rasamanie-
2011,Mukhtar che Ali- 2010), Quality costing reporting studies in Australia by Judi Oliver and
Wen Qu (1999), Analytical study of cost of quality of construction projects in Dubai (Hisham
M.E. Abdelsalam-2009) , cost of quality practices in Spain (Oriol Amat and John Blake-1993),
Quality management through ISO certification and quality costs reporting studies in Bahraini
companies (Sayed Ramadhan-2005) are few among them.
These studies shows that the industrial application of COQ methods are still limited to the
traditional PAF model even though the strengths and capabilities of latest models in overcoming
the limitations of PAF method is well appreciated by academic community. In most of the cases
only direct and easily traceable costs only are gathered (Schiffaura- 2006).
1.1. Significance of the study
Many researchers were pointed out the requirement of analyzing all elements of quality costs to
make optimal decisions that leads to competitive advantages in the highly customer driven
modern market (Yang-2008). Bramford (2006) emphasize the quality cost analysis can be used as
an effective tool for management only when all quality cost elements are captured. Improvements
in the conventional model with the incorporation of additional cost categories were made by
many researchers. Modaress & Ansari (1987) incorporated two additional dimensions viz, cost of
quality design and cost of inefficient utilization. The losses incurred due to the internal
inefficiencies were studied by Dahlgaard etal (1992). Sandoval-Chavez (1998) presented a
modified COQ model with the inclusion of three elements –under utilization of installed capacity,
inadequate material handling and poor service delivery. Giakatis (2000) analyzed the losses
4. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
16
incurred against manufacturing and design losses. Intangible costs like loss to society is analyzed
by Teevaraprug(2004).Gary Cockins (2006) has explained the difficulty in measuring hidden
costs. Yang (2008) attempted to quantify lost sales as estimated hidden cost. Soo-Jin Chea (2011)
presented an action research study of tracking hidden quality costs in a manufacturing process
with a focus on the resistance of employees towards implementation of COQ system. The
significance of tracking and gathering hidden quality cost data were explained by Kume (1985),
Sandoval (1998), Giakatis etal(2010) , Johannes Freiesleben and Suresh Krishna(2010) .
Even though these studies were well appreciated by the quality practitioners, not much practical
studies found available in the literature with comprehensive data collection and analysis of all
costs including hidden costs incurred against all quality improvement activities in the
organization.
The practical studies in the case of hidden costs of quality are limited to hidden failure costs
(Suresh Krishna-2006) and hidden costs in the manufacturing process (SooJin-Chea-2011). Not
many studies are in place on opportunity costs also. Any activity which is not performed well in
right time always incurs a loss to the organization. Opportunity costs are the losses incurred
against a missed out opportunity of doing things right at first time. It is actually the measure of
internal inefficiencies and its analysis will provide immense opportunities for improvement.
Hence an attempt is made in this research to unveil all hidden quality costs including opportunity
costs right from the customer requirement analysis to after delivery support , in a manufacturing
firm. In the current era, the analysis of each individual stage in the supply chain ranging from raw
material acquisition to final delivery of the product is equally important (Ashish J. Deshmukh.and
Hari Vasudevan 2014).
2. RESEARCH OBJECTIVE
The objective of this study is to identify measure and quantify all the hidden elements –direct,
indirect and invisible elements of quality costs in all functional activities in the organization
under study. Further the importance of such an analysis is ascertained by quantifying the impacts
of hidden costs on the overall quality cost as well as on the organizational bottom line.
2.1. Methodology
The following methodology was adapted in this study:
1. Identification of all processes and quality cost elements in all corresponding activities,
Comprehensive data collection and quantification, Grouping in to direct and hidden Cost
of Quality.
2. Analysis of impact of hidden COQ on total quality cost and also on organizational bottom
line.
3. Comparison of traditional COQ system with enhanced COQ with hidden costs included.
Personal interviews and discussions with the employees in each section were carried out to list
out all processes, its input, output and control process as per the process cost model and all the
activities in each process in the supply chain line is identified. Every activity is then analyzed
critically to identify the quality lapses in each, which leads to an additional expense or loss to the
organization. The missed out opportunities for improvement also listed out. The additional
5. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
17
resources utilized in each of this instances are systematically identified and quantified using the
records like log books, route cards, registers, time study, personal interviews etc. to get the cost
incurred in each. Then these cost elements are classified into direct and indirect costs as per the
categorization in Figure.1. Further detailed comparative analysis is carried out between them.
Finally the impact of indirect and hidden quality cost elements on the overall quality cost and to
the organizational bottom line are analyzed.
Total Cost of Quality
Cost of Conformance (COC) Cost of Non Conformance (CONC) Opportunity Costs (OC)
Direct Hidden Direct Hidden
PC AC IFC EFC
(PC-Prevention Costs, AC- Appraisal Costs, IFC- Internal Failure Costs, EFC- External Failure Costs)
Figure 1. Categorization of quality cost elements
3.DATA COLLECTION AND CATEGORIZATION
The research has been carried out in a firm under electronic industry engaged in the
manufacturing of electronic equipments which is already having ISO 9001:2008 certification. The
PAF model of quality costing was already in practice in this firm with emphasis only on
traditional P-A-F elements of quality costs which are easily and directly measurable.
During this study, a comprehensive data collection strategy has been adopted for gathering
information on various quality cost elements in each activity. For this, the Process Cost Model
approach has been adopted, where in each functional area is treated as a set of processes with
definite input, output and control processes. Each process is critically analyzed to gather
maximum information on quality deviation against all the activities which make the process
complete. Then the cost incurred including indirect and hidden against these quality deviations
are quantified using the records of additional resource utilization in this regard. Lost opportunities
in each process also identified and corresponding cost data captured and quantified.
The traditional elements of costs of conformance and non-conformance identified and analyzed in
this research are listed in Table-1.
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Table.1 – Direct Quality Cost elements
Direct Conformance Costs(COC-D) Direct Non conformance Costs(CONC-D)
Prevention Costs (PC-
D)
Appraisal Costs (AC-
D)
Internal Failure Costs
(IFC-D)
External Failure
Costs (EFC-D)
Cost of maintenance of
ISO certification
Raw material inspection Scrap wastages Trouble shooting
of field failures
Training cost on quality
standards, theories and
practices
In-Process inspection-
sub assemblies and
assemblies
Internal Trouble
Shooting - Repair , Re-
test etc.
Expenditure on
customer service
dept. for support
calls from
customers
Cost on administration
of quality issues
Final tests after
integration of sub
assemblies and modules
Rejections and rejection
analysis
Repair of
defective parts
Cost on vendor quality
assurance
Pre- dispatch tests by
quality assurance
department
Re work Replacement of
defective parts
Preventive maintenance
cost of equipments &
machineries
Cost on internal as well
as customer audits
Excess material drawn
against rejections, scraps
etc.
Product recalls.
Preventive maintenance
of test jigs & tools
Interest on non moving
inventory
Machine break down
Cost of calibration of
equipments
Materials written off due
to product design
changes
The hidden quality cost elements are identified by extensive information collection by interviews, log
books, records and registers kept in various activity centers with entry of time study, time cards, machine
logbooks, complaint log books, attendance cards, minutes of meetings etc. and the cost elements identified
in this study are listed in Table 2.
Table-2- Hidden quality cost elements
Hidden Conformance Costs(COC-H) Hidden Non conformance Costs(CONC-H)
Prevention Costs
(PC-H)
Appraisal Costs
(AC-H)
Internal failure Costs (IFC-H)
External Failure
Costs (EFC-H)
Customer
requirement
review
Process audits at
vendor premises
Engineering or design mistakes Warranty claims
Engineering
design reviews
Customer audits Billing errors and rework on bills
Man power for
field assistance
on complaints
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19
Process validation
Document procedures for raw
material rejections
Emergency
dispatches
Production Planning errors
Raw material planning errors lead
to extra raw material cost
Similarly lost opportunities due to incapability of the system as well as inefficiencies are also
listed out in each process and measurement techniques are devised by extensive data collection
against each element identified after rigorous discussions with the authorities concerned. The
identified Opportunity Cost (OC) elements with details are listed in Table-3.
Table 3: Opportunity Cost elements
1 Under
utilization of
machine
capacity
Utilization below the installed planned capacity of machines due to insufficient
customer orders, balanced quantity of raw materials, consumables or work force as
well as planning inefficiencies.
2 Loss due to
delayed
payments
Delayed payments to the raw material vendors and loss of mutual trust results in
demand from vendors for advance payments instead of credit purchases. Loss on
account of interest against the lost credit period.
3 Customs
clearance of
materials
Customs demurrage charges on delayed customs clearance of materials. Also results
in extra documentation , Follow up time etc.
4 Excess
Financial
charges by
Banks
Penalties imposed by banks against insufficiency of documents for financial
clearances, Losses due to foreign exchange variations due to the absence of forward
contracts etc.
5 Emergency
Dispatches
Extra shipping costs to meet customer urgency and to cop up with delayed dispatches.
6 Late
delivery(LD)
Liquidate damages (LD)imposed by customer on late deliveries, part deliveries, delay
in after sale support etc.
7 Sundry
Debtors
Payment realization delays results in accumulation of sundry debtors and loss of
interest or availability of sufficient fund flow.
8 Lost sales Poor performances in product and service leads to customer dissatisfaction which in
turn results in reduction in market share.
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20
3.1DATA ANALYSIS AND DISCUSSIONS
Based on the data collected, different quality cost elements are grouped into different cost
categories and computed for a period of 3 consecutive years as summarized in Table-4 along with
its percentage analysis to annual sales volume as well as to total cost of quality.
Table 4: Comparative analysis of cost categories of quality cost data
The result shows that Cost of quality captured in the traditional systems in the year-1 is 8.89 % of
sales revenue whereas the same in the enhanced system with hidden and opportunity costs
included is 34.02%. The total hidden and opportunity costs amounts to 25% of sales revenue,
which is around 3 times higher than the costs based on traditional P-A-F model. The traditional
quality cost amounts to 26.14% of total quality cost, where as total sum of hidden quality cost is
73.86% of total quality cost, out of which major portion is contributed by the opportunity costs
(69.63%).
Similar is the case with next two consecutive years under study; where in the total direct costs are
10.20% & 14.98% of sales turnover and 23.89% & 21.24% of the total COQ. Here also the
opportunity costs are more than 30% & 50% of sales revenue respectively. When we analyze the
9. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
21
per category contributions to the total quality costs, opportunity costs shows the major category
with more than 70% contribution as represented in Figure 2, Figure 3 & Figure 4 .This gives a
clear picture of the quantum and impacts of hidden quality costs and opportunity losses to the
organization.
Figure 2, 3, 4: Category wise contribution to total Quality Cost for Year1, Year2 & Year 3
The Pareto analysis of all the identified cost elements also confirms the importance of hidden
cost elements. Out of the total 43 quality cost elements identified under various categories, 8
cost elements found contributing to more than 80% of the total COQ value, out of which first
three major contributors are of opportunity cost.
Figure 5: Pareto analysis of the opportunity costs
The Pareto chart shows that 80% of the quality costs come from 20% of the causes. The analysis
shows that Interest on Sundry debtors (25.93%), under utilization of machine capacity (22.91%)
10. International Journal of Managing Value and Supply Chains (IJMVSC) Vol. 6, No. 2, June 2015
22
and lost sales (18.74%), are the major categories of the total quality costs. All these three
elements are hidden opportunity cost elements. Figure 5 shows the Pareto analysis of these
results.
As per the traditional P-A-F system of quality cost calculation, the firm under study was
considered as a healthy organization with cost of quality value within an admissible limit of 10%
of sales turn over in the first year of study. But this study reveals that the actual quality cost of the
firm in first year itself is more than 30% of sales revenue and in the second year it has become
42% and in third year 70% which is an alarming situation. This shows the inadequacy of
traditional accounting system in capturing the actual quality costs and also the importance of
analyzing various hidden quality costs in a firm.
It is also found that the hidden COQ is higher than the net profit of the company. On analysis it is
revealed that most of these opportunity costs can be eliminated with awareness of the impact of
the lost opportunities and proper planning to eliminate the root causes. The underutilization of
machine capacity can be reduced or eliminated with the proper utilization of man power, by
capturing more orders by market intelligence and also by effective production planning and
scheduling. The lost sales are due to the impact of customer dissatisfaction on quality of supply,
delayed delivery and services. Proper and timely payment realization techniques and follow-ups
can reduce the losses on account of interest on sundry debtors. Engineering and design mistakes
are making many fold effects once it is identified in later stages of production process. This can
be avoided by the proper and systematic verification of design requirements in the beginning
itself. Most of the hidden costs can be eliminated by ensuring a smooth flow of error free
information throughout the production process. This can be ensured with the help of an integrated
manufacturing management system. Marketing, Customer engineering, Planning, Purchase,
Manufacturing, Quality Assurance, Dispatch and Billing sections can be made integral part of this
system. Manual document preparation errors and delays in procedures can be reduced with the
usage of this system. Requirement of customer orders to be translated to tables of requirements by
marketing department and then key parameters for production process to be identified by
manufacturing method section. Subsequently planning dept. can use this data to generate raw
material quantities required for production loading for fulfilling the available customer order.
Procurement and receipt details of raw materials and consumables also to be updated to the same
system from purchase modules. Using this data, manufacturing department can schedule the job
work and dispatch information. The costs associated with all the type of manual errors including
documentation, loading, scheduling and billing errors can be made zero with the usage of such a
system.
This root cause analysis of opportunity costs gives an insight to the opportunities to improve the
bottom line of the organization. These losses can be converted to opportunities for increasing
profit margin of the firm.
4. CONCLUSIONS
In this study, a comprehensive analysis of all cost elements which contributes to the quality of
products and services in the supply chain line of a manufacturing firm has been conducted. Apart
from the normal prevention-appraisal-failure mode quality cost categories, more in depth analysis
of all activities in the whole supply chain is done to track and measure the hidden elements of
quality cost including the opportunity cost elements.
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23
The study findings points out the fact that the hidden cost of quality is more than 3 times higher
than the direct quality cost elements in the manufacturing firm and most of these hidden costs can
be reduced or even eliminated by proper tracking and understanding the root causes.
This study highlights the inadequacy of traditional cost of quality system in tracking and
assessing the overall costs of quality. In order to assess the overall cost of quality, the hidden
costs also has to be identified, quantified, measured and analyzed. For tracing the hidden quality
costs, it is necessary to move beyond the data produced by the traditional accounting system. This
also gives an insight to the huge impact of hidden quality costs to the organizational bottom line
and points out the gold mine of improvements. Using this data the company can formulate
survival strategies in the highly intensive competitive market scenario.
Future studies in this field are recommended with the study of impacts of hidden elements on
overall quality cost and development of a quality cost expert system with inclusion of hidden and
opportunity cost elements.
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