ASQ TR2:2018 (e-standard)

This Technical Report was prepared to address the need for guidance on Cost of Quality for development, implementation and monitoring to improve quality and overall organizational performance. This guidance is either in the context of an established management system (e.g., quality, environmental, occupational health and safety, etc.) or as an independent management activity. In either case, this document provides expectations for the processes and activities associated with the products and services an organization produces or provides to the extent realization processes have been deemed necessary. The Cost of Quality process employed should be compatible with other associated financial analysis activities used by the organization to ensure continuity and commonality of purpose.

Among the benefits of establishing a Cost of Quality are:

a. increased visibility of the value of activities performed;

b. greater insight into opportunities for improvement;

c. reduced wastes or the impact of problems;

d. improved organizational competitiveness;

e. amplified engagement of leadership in improvement activities.

This Technical Report follows the high-level structure for management systems that is provided in Annex SL of the ISO directives. This document provides guidance for implementation of a Cost of Quality process for organizations of any type, size and complexity. A Cost of Quality process integrated within the organization’s Quality management system(s) helps the organization realize more effective bottom line benefits. Appendices added to this document provide guidance in using costs existing within the business for a Cost of Quality process by asking a series of fundamental questions. A sample worksheet is also provided for guidance to help start the analysis.