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Cost of quality

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Ganesan Balaji PMP, RMP, PgMP Lead| --- Tx, United States
As per PMI ensuring quality has a cost. Per PMI quality should be built in and "not inspected".

As non conformance increases the cost and prevention is cheaper than repair/correction, quality should be ensured as part of "Conformance cost".

For this to happen, the buyer should be knowledgeable and should have done similar project previously in order to completely capture the all such requirements.

Could you elaborate how is this achieved/incorporated in your projects/program?
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Anand Jayaraman Doctoral Researcher| Golden Gate University Chennai, Tamilnadu, India
In my personal opinion it is mostly achieved through customer education or awareness creation and how the quality matters to their expected return on investment. This sometimes depending on the customer happens continuously. But now a days customers and end users more aware of quality cost and pro-active prevention of any hassles to the product or their service.
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1 reply by Rami Kaibni
Jan 03, 2016 5:53 PM
Rami Kaibni
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Anand, I tend to agree with you especially the first sentence.
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Steven Zachary Director| Alberta Health Services Calgary, Alberta, Canada
@Balaji

A few off the top of my head, in bullet form:

Product or service requirements
Quality planning
Quality assurance
Training

Appraisal costs:
Verification
Quality audits
Supplier rating

Internal failure costs:
Waste
Scrap
Rework or rectification
Failure analysis

External failure costs
Repairs and servicing
Warranty claims
Complaints
Returns

In short, COQ is a highly complex and worthwhile subject. It's also as deep as you want to make it based on a host of factors like company size, complexity of product offering...etc. The above points are some of the metrics I've helped organizations implement to measure to ensure COQ is adequately integrated into the business processes.

I hope I answered your question here, it's such a large topic.
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Rami Kaibni
Community Champion
Senior Projects Manager | Field & Marten Associates New Westminster, British Columbia, Canada
Jan 03, 2016 10:04 AM
Replying to Anand Jayaraman
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In my personal opinion it is mostly achieved through customer education or awareness creation and how the quality matters to their expected return on investment. This sometimes depending on the customer happens continuously. But now a days customers and end users more aware of quality cost and pro-active prevention of any hassles to the product or their service.
Anand, I tend to agree with you especially the first sentence.
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Rami Kaibni
Community Champion
Senior Projects Manager | Field & Marten Associates New Westminster, British Columbia, Canada
Bajali,

Besides what Anand said, I would like to add an important factor besides the customer awareness which is Lessons Learned that is part of the organization process assets and a core input when evaluating the COQ.

WBS, Lessons Learned combined with expert opinions should give you quite a good estimate.
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Paolo Cornali Project Manager| HTA srl Brescia, Lombardia, Italy
I agree with Rami about the using of WBS and lesson learned combined with expert opinions and I would add risk analysis for evaluating the COQ completely.
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1 reply by Rami Kaibni
Jan 04, 2016 1:58 AM
Rami Kaibni
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I agree with you Paolo, absolutely.
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Rami Kaibni
Community Champion
Senior Projects Manager | Field & Marten Associates New Westminster, British Columbia, Canada
Jan 04, 2016 1:17 AM
Replying to Paolo Cornali
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I agree with Rami about the using of WBS and lesson learned combined with expert opinions and I would add risk analysis for evaluating the COQ completely.
I agree with you Paolo, absolutely.
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1 reply by Steven Zachary
Jan 04, 2016 1:04 PM
Steven Zachary
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Let me get this straight.

Rami, you agree with Paolo who agrees with you? I could draw this out if needed?
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Steven Zachary Director| Alberta Health Services Calgary, Alberta, Canada
Jan 04, 2016 1:58 AM
Replying to Rami Kaibni
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I agree with you Paolo, absolutely.
Let me get this straight.

Rami, you agree with Paolo who agrees with you? I could draw this out if needed?
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1 reply by Rami Kaibni
Jan 04, 2016 1:12 PM
Rami Kaibni
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Steven, what are you implying here ?

Paolo agreed with me and added one more point which I agreed with !
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Rami Kaibni
Community Champion
Senior Projects Manager | Field & Marten Associates New Westminster, British Columbia, Canada
Jan 04, 2016 1:04 PM
Replying to Steven Zachary
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Let me get this straight.

Rami, you agree with Paolo who agrees with you? I could draw this out if needed?
Steven, what are you implying here ?

Paolo agreed with me and added one more point which I agreed with !
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Ganesan Balaji PMP, RMP, PgMP Lead| --- Tx, United States
No emotions please.

Cost of quality can be even verified at the level of each deliverable and this depends on the nature and scope of project.
For example, i work on gas plant project, Cost of quality for example can be verified for "applying lethal service" in certain equipment or system and verify whether this level of quality is needed.
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Rami Kaibni
Community Champion
Senior Projects Manager | Field & Marten Associates New Westminster, British Columbia, Canada
True, it is an iterative process but the earlier the COQ is counted for, the less risk.

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