Q: Hello, I am having trouble locating basic summary information about the “cost of quality” for various industries. In brief: what is the cost of NOT having good quality in specific industries, such as automotive. Put another way, what is it worth to a “typical” company or industry to enact good or better quality practices? I realize this is an abstract question with many underlying variables, and looked at some old (1999) work on this, but am seeking any summary information you might know of. Thanks so much.
A: Thank you for contacting ASQ and the Quality Information Center. I received your request for some information regarding cost of quality.
Donald L. Siebels, in his book The Quality Improvement Glossary, defines quality costs as “a measure of the cost specifically associated with the achievement or nonachievement of product or service quality, including all product or service requirements established by the company and its contracts with customers and society. More specifically, quality costs are the total of the cost incurred by (1) investing in the prevention of nonconformances to requirements; (2) appraising a product or service for conformance to requirements; and (3) failure to meet requirements. These can then be categorized as prevention, appraisal, and failure”. Additionally, Siebels defines the cost of poor quality (COPQ) as “costs associated with providing poor quality products or services”.
I have searched the ASQ Knowledge Center and the ASQ website and have found some resources on COQ that I think might also help to answer your question:
Learn About Quality: COQ webpage
- “What Are Quality Reputations Worth?“, Quality Progress, Feb. 2006
- “Blurred Vision“, Quality Progress, July 2008: (includes some COQ information)
- “The Tip of the Iceberg“, Quality Progress, May 2001
- “Quality Problems and Their Real Costs“, Quality Progress, Dec. 2004
- “What Do CEOs Think About Quality?“, Quality Progress, May 2004
You may also want to check out more Quality Progress articles under the heading of “Economic Case for Quality”
I hope that this information is helpful. If you would like to search on your own for ASQ resources, you can do so in the ASQ Knowledge Center. If you have any questions, please feel free to contact me.
ASQ Research Librarian