Cost of quality (COQ) is defined as a methodology that allows an organization to determine the extent to which its resources are used for activities that prevent poor quality, that appraise the quality of the organization’s products or services, and that result from internal and external failures. The cost of Quality of average Indian organisation are in the range of 25-30% of sales. Hence, there is an ample opportunity for the Indian companies to work on measuring the cost of quality in the organisation to improve profitability with existing resources.
Cost of Quality Consists of Prevention Cost, Appraisal cost, Internal Failure Cost, External Failure Cost, Cost of Lost Opportunities.
Cost of quality provides a very useful tool to change the way management and employees think about the error.
All India Rubber Industries Association (AIRIA) is organising a FREE WEBINAR on “Cost of Quality and its Impact on Profitability in Rubber Industry”