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Tutorial 7

Tutorial 7. Date: 28/11/2012 Instructor: Hanif Ullah. Cost of Quality (COQ ). It’s a term that's widely used – and widely misunderstood . The "cost of quality" isn't the price of creating a quality product or service. It's the cost of NOT creating a quality product or service .

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Tutorial 7

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  1. Tutorial 7 Date: 28/11/2012 Instructor: HanifUllah

  2. Cost of Quality (COQ) • It’s a term that's widely used – and widely misunderstood. • The "cost of quality" isn't the price of creating a quality product or service. It's the cost of NOT creating a quality product or service. • Every time work is redone, the cost of quality increases. Obvious examples include: • The reworking of a manufactured item. • The retesting of an assembly. • The rebuilding of a tool. • The correction of a bank statement. • The reworking of a service, such as the reprocessing of a loan operation or the replacement of a food order in a restaurant.

  3. Types of Quality Costs • Prevention Costs: • The costs of all activities specifically designed to prevent poor quality in products or services. • Examples are the costs of: • New product review • Quality planning • Supplier capability surveys • Process capability evaluations • Quality improvement team meetings • Quality improvement projects • Quality education and training

  4. Types of Quality Costs • Appraisal Costs: • The costs associated with measuring, evaluating or auditing products or services to assure conformance to quality standards and performance requirements. • These include the costs of: • Incoming and source inspection/test of purchased material • In-process and final inspection/test • Product, process or service audits • Calibration of measuring and test equipment • Associated supplies and materials

  5. Types of Quality Costs • Failure Costs • The costs resulting from products or services not conforming to requirements or customer/user needs. Failure costs are divided into internal and external failure categories. • Internal Failure Costs: • Failure costs occurring prior to delivery or shipment of the product, or the furnishing of a service, to the customer. • Examples are the costs of: • Scrap • Rework • Re-inspection • Re-testing • Material review • Downgrading

  6. Types of Quality Costs • External Failure Costs: • Failure costs occurring after delivery or shipment of the product — and during or after furnishing of a service — to the customer. • Examples are the costs of: • Processing customer complaints • Customer returns • Warranty claims • Product recalls • Total Quality Costs: • The sum of the above costs. 

  7. Identify software quality Cost • Project quality plan • Number of errors per 1000 line of code (KLOC) • Over time hours to finish software inspection • Configuration management tool purchase • Detailed design walkthrough • Re-programming of defects of a program before shipment • Room temperature • Payment of external consultant to participate in unit testing • Payment of external consultant to prepare software quality assurance procedures and checklists • Purchase of software unit to integrate with our application • Training of programmers in a course " Java advanced programming" • Correction of software defects for installed software after customer complaints • Construction of new company building

  8. Importance of software quality cost model To help the project management team in distributing the cost to the four parts and to check the outcomes. Based on theses outcomes the budget is adjusted and redistributed i.e. a kind of decision making for management.

  9. Identify software quality Cost • Project quality plan NIL • Number of errors per 1000 line of code (KLOC) NIL • Over time hours to finish software inspection Appraisal Cost • Configuration management tool purchase Prevention Cost • Detailed design walkthrough Appraisal Cost • Re-programming of defects of a program before shipment Internal failure Cost • Room temperature NIL • Payment of external consultant to participate in unit testing Appraisal Cost • Payment of external consultant to prepare software quality assurance procedures and checklists Prevention Cost • Purchase of software unit to integrate with our application NIL • Training of programmers in a course " Java advanced programming“ Prevention Cost • Correction of software defects for installed software after customer complaints External Failure Cost • Construction of new company building NIL

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