Problem Based Quality Costing for TQM Progress Measurement

Article

Robison, Jim   (1992, ASQC)   The Carman Group, Inc., Richardson, TX 75083

Annual Quality Congress, Nashville TN    Vol. 46    No. 0
QICID: 9792    May 1992    pp. 1144-1149
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Article Abstract

Although information about the principles of quality cost is readily available, many managers are still frustrated by trying to implement them effectively. The author proposes that cost metrics are often ignored, which leads to this frustration.

Include Cost of Quality Analysis in the initial TQM Assessment Process, for a start. A useful mechanism is the Financial Chart of Accounts, which identifies key line item costs for each cost center. Doing so gives you a baseline from which to measure progress. You must continually examine each process or procedure you implement to make sure it really reduces failure cost. Look at your quality systems from a profit-and-loss perspective. Make sure your supplier partnerships decrease failure costs. Empowered problem solving teams must be examining problems that lead to cost. Problem Based Quality Costing (PBQC) addresses these issues by finding and fixing problems, and working within your current team situation and accounting system.

Employees who are properly trained in PBQC and data that is properly tracked results in a reduction of quality costs. Expect PBQC to be unique for each company, and apply basic textbook approaches to your own system. Without this kind of measurement, you will never fully realize and reduce the costs of quality.

Keywords

Control charts,Continuous improvement (CI),Cost of quality (COQ),Metrics,Problem solving,Total Quality Management (TQM)


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