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41 Examples of the Cost Of Quality

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Cost of quality is a measurement of the costs of both conformance and non-conformance to quality requirements and customer expectations. As this measures two different things, people find the term confusing and commonly use it to mean one or the other but not both. For example, it is common to use "cost of quality" for conformance costs and "cost of poor quality" for non-conformance costs. The following are common examples of both.

Cost of Quality

Technically speaking, cost of quality includes the costs of both conformance and nonconformance. However, people often think of this as being the costs of achieving quality. This can include:
Customer advocacy process costs
Inspection costs
Market research costs
Material inspection costs
Process improvement costs
Quality audits costs
Quality consulting costs
Quality improvement costs
Quality inspection costs
Quality planning costs
Quality related design costs
Quality related partner costs
Quality related production costs
Quality related redesign and redevelopment costs
Quality related software costs
Quality reporting costs
Quality standards compliance cost
Supplier quality evaluation costs
Testing costs
Training costs

Cost of Poor Quality

The costs of nonconformance to quality requirements or a failure to meet the quality expectations of customers.
Bad publicity
Cost of poor product ratings and reviews
Customer compensation costs
Customer complaints
Customer returns
Customer support costs
Damage to brand
Failure analysis costs
Field service costs
Legal costs related to quality issues
Lost sales costs
Negative coverage by media and influencers
Negative work of mouth
Product liability costs
Product recalls
Public relations costs related to negative publicity
Regulatory actions
Retesting
Rework due to inspection failure
Scraped due to inspection failure
Warranty claims

Notes

Historically, quality was measured in terms of conformance to quality requirements. This could still produce very low quality items if your requirements are low. Modern quality practices are more concerned with quality perceptions in the market including customer satisfaction, reviews and ratings.

Quality

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