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Prevention costs
Appraisal Costs
Failure costs
Prevention costs
Appraisal Costs
Failure costs
Setting specifications (incl. services, materials, processes and products) Pre-production/ operation and prototype trials
Rework & rectification Downgrading of products & services Product or service complaints & warranty claims
Production/operations
Prevention costs
Appraisal Costs
Failure costs
Training - including supervisor training Pre-production/ operation and prototype trials Special handling & storage during production or operations Supervision of quality at all stages
Line or process inspection (by production/operations personnel) Finished product inspection or service checking (by production/operations personnel)
Full cost of scrap or wasted effort Rework & rectification Replacement of rejected product or repeating service Downgrading of products, materials and services
Prevention costs
Appraisal Costs
Failure costs
Market research Correct forecasts Setting of correct product or service specifications as per the requirement of customers
Analysis of degree of Downgrading of products acceptance of goods and and services services Customer complaints, liaison & compensation Warranty claims & replacements or refunds
Purchasing
Prevention costs
Appraisal Costs
Failure costs
Service department
Prevention costs
Appraisal Costs
Failure costs
Product or service specification evaluation Pre-production/ operations and prototype trials Planning of in-process control procedures
Finished product or Customer complaints service performance Product or customer service evaluation Returned material investigations and repairs
Personnel
Prevention costs
Appraisal Costs
Failure costs
staff Dealing with results of poor recruitment process Disciplinary procedures Strikes/Union problems High employee turnover
Prevention costs
Appraisal Costs
Failure costs
Special storage
handling
and
Receiving and checking materials bought-out items or services Checking and despatching finished product and/ or services
Sorting of reject finished goods in stock Receiving and checking returned reject goods Checking and despatching replacement goods
Material control
Prevention costs
Appraisal Costs
Failure costs
Excess inventory Scrap material control Ordering of material or services for replacement.
Maintenance
Prevention costs
Appraisal Costs
Failure costs
Prototype processes and equipment Planning and maintenance of plant equipment and inspection equipment
Equipment monitoring
reliability Downtime of plant & machinery Trouble shooting and investigation of defects
Finance
Prevention costs
Appraisal Costs
Failure costs
Establishment of good financial systems with proper controls in place. Proper assessment of customers on credit facility. Feasibility studies
Auditing accounts Investigations following Determination of quality failure in the system related costs Chasing recoveries from the customers Bad debts Losses