Cost of Poor Quality - Lean Conference 2016

Post on 13-Apr-2017

95 views 3 download

Transcript of Cost of Poor Quality - Lean Conference 2016

QUALITYPrepared By: Apu Sen

“Quality means conformance to requirements”.- Philip Crosby. 'Quality Is Free’

Quality is the ability of your product to be able to

satisfy your users

What is Quality ?

Quality Assurance is the process that demonstrates your product is able to

satisfy your users

What is Quality Assurance ?

When good Quality Assurance is implemented, there should be improvement in

usability and performance and reducing rates of

defects

What is the Aim of Quality Assurance ?When good

Quality Assurance is implemented, there should be improvement in

usability and performance and reducing rates of

defects

Quality policy

Cost of Poor Quality

Categories of Quality Cost

Cost of Poor Quality

PREVENTION COSTThe cost of any action taken to investigate, prevent or reduce the risk of a non - conformity.

Internal Failure COSTCost incurred when products and

services do not conform tospecifications.

APPRAISAL COSTThe costs associated withmeasuring, checking, or

evaluating products or services to assure conformance to quality

requirements.

External Failure COSTThe costs arising after delivery of

product or service to the customer due to non-

conformities or defects.

Cost of Conformance Cost of non-Conformance

Cost of Poor QualityCost of Conformance Cost of non-Conformance

Cost of Poor Quality Examples

The world's largest manufacturer of personal computers, Dell, is to recall 4.1

million of its notebook computer batteries because of a fire risk.

Mattel recalls 18m more toys 2007

US toymaker Mattel has recalled more than 18 million toys worldwide, the second such

recall in two weeks because their paint contains lead.

Cost of Poor Quality Examples

• Largest environment disaster in US.• Reason is weak cement use around the

well.• Process approach Brocken.• 10 billion dollar loss

Space Shuttle Disaster 1986

The American space shuttle, Challenger, has exploded killing all seven astronauts on

board due to O-ring seal breakdown.1 billion dollar loss

Cost effectiveness along the processThe later in the Value Stream we find a problem, the higher the cost

Financial costsLost customer loyaltyDamage business reputationNeed for greater control & checksCompetitive take advantage

How Poor Quality Effect Us

focusing on process rather than outcome is a

much better strategy.