Cost of Quality CoQ and Its Significance

What Is The Cost of Quality (CoQ)?

Cost of quality measures the impact of quality in any business. Cost of quality is mainly divided into two parts named as:

1. Cost of conformance
2. Cost of non conformance

• Cost of conformance:- It is the cost of providing product product or services as per the required standard. It is divided into two parts.

1. Preventive cost: Preventive cost is related to attempts made to prevent the failure.

Example: Training of the employee cost, process simplification cost, process improvement cost etc..

Note: If preventive cost is high then failure cost will be low.

2. Appraisal cost: It is a cost for the activity to assure that no defect was found.

Example: Inspection cost, auditing cost etc..

• Cost of non-conformance- It is a cost that occurs due to faulty services or defective parts.

1. Internal failure cost: It appears when the end product fails to meet the requirement and is detected before transfer to the customer.
2. External failure cost: It appears when the product is delivered to the customer.

NOTE- when we add cost of conformance and cost of non conformance then we get cost of quality.

Dimensions of Quality:-

1. Reliability
2. Durability
3. Serviceability
4. Performance
5. Conformance
6. Aesthetic
7. Special features

Service quality: It is defined as experience felt by customers.

Dimensions of Services Quality:-

1. Tangible: It is related to the surroundings in which service is provided to the customer.
2. Responsiveness: It means how fast you respond to complaints and query:
3. Assurance: Gain the trust of the customer.
4. Empathy: Individual care of the customer.
5. Reliability: It means how reliable you are as an organization.

Types of quality: Quality can be divided in three parts named below:

1. Quality of design
2. Quality of conformance
3. Quality of Performance

• Quality of design:- It means the intention of the designer to include or exclude features in product or services.
• Quality of conformance:- It means how well the product or services meet the requirements mentioned by the client.
• Quality of performance:- It is associated with the reliability of the product or services performing its intended function under the prescribed set of conditions.

Example:-Let us consider a voltage stabilizer has a range of 190-270 volts.

• If it does not perform satisfactory in this range it means quality of performance is poor.
• If it works efficiently in this range this means quality of performance is good.
• If it performs in the range of 180-280 volts it means this is a robust product and has excellent quality of performance.

Note: In the software industry to test the performance of the software we do performance testing.

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