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One of the most effective tools for evaluating the success of a quality management programme is the measurement of quality costs (prevention, appraisal and failure costs). The application of the concept of quality costs originated in the early 1950s. A systematic approach is needed for measuring quality costs. This paper describes a case study to c...
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... Quality costs are defined as "costs incurred for ensuring conformance to quality standards or compensating for nonconformance to quality standards" (Kim & Liao, 1994). One of the most critical and influential tools for evaluating the success of Total Quality Management programs in industrial companies is measuring the cost of quality (CoQ) (Jaju et al., 2009). ...
Over the years, bread has become a staple food for millions of Cameroonians, with each Cameroonian consuming 33 kilograms of wheat each year. This has made bread production a highly lucrative business for manufacturers. According to Taguchi, a product does not cause a loss only when it is outside specification limit but whenever it deviates from its target value. This study measured the quality of bread already on the market with the objective of quantifying the financial losses to society and evaluated the process sigma quality level to guide efforts to improve the process. The study population consisted of 400 bread samples of two most consumed types of bread, selected using a systematic random sampling method from a total of four bakeries and five sale points in Bamenda and Bafoussam Cities of Cameroon. The results indicated that 15% of the breads from Bakery D did not meet the weight specifications, while 42% of the 600g bread presentation did not meet the specifications. The remaining bakeries had a weight deviation of between 95% and 98%. The losses for the products with presentations of 600g, 200g (Bakery A), 200g (Bakery B), 200g (Bakery C), and 200g (Bakery D) are 59.81 xaf, 44.22 xaf, 23.03xaf, 26.91xaf, and 35.14 xaf, respectively. The 600g bread presentation incurred the greatest economic loss when it deviated from the nominal value, while bakery A exhibited the best sigma quality level of the process, 5.61 sigma. It was recommended that various stakeholders throughout the country consider substituting portions of wheat flour with cassava flour in the manufacturing of composite bread. Additionally, it was suggested that the weight and quality of bread available on the market be monitored and controlled in order to minimize losses to society.
... 43 Examples of PAF methodology can be found within foundry settings. 44, 45 Burgess 46 denoted that overly complex approaches, such as process cost, are unwarranted in this well-defined quality setting (pass/fail). To that end, for this paper, the following definition effectively describes the CoQ for sub-surface porosity in the test part; ...
Significant evidence now supports the quality improvement seen in castings that employ naturally pressurized filling systems in their production. However, despite the documented evidence for improvement, these systems have not become ubiquitous. Gray iron, the industry’s most prominent alloy, has been particularly slow to accept the shift in system design. The suggested tolerability of gray iron to turbulence, the market’s price sensitivity, and the perceived economics of naturally pressurized systems are potential factors that have hindered adoption. However, if, through improved quality, the economic justification for these systems can be made in this adverse setting, there is a merit in their application to all alloys and processes. A sample gray iron part, currently being produced in a foundry environment with known porosity issues, was selected, to which a new system and several basin designs were applied. A mixed method analysis of casting simulations, production trials, and economic and environmental modeling was used to evaluate system performance. The results show a strong association between filling system design and sub-surface porosity. However, no association was found between basin design and porosity occurrence at lower porosity levels. Nevertheless, the economic and environmental modeling highlights that quality-orientated systems yield significant financial and environmental savings for the organization due to reduced scrap levels. These findings imply that quality-orientated system designs should be employed even when cost is the most critical measure.
... The price of unacceptable products or services is the cost of quality. Cost of prevention, Cost of Appraisal, Cost of Internal Failures (or Cost of Non-Conformance), and Cost of External Failures are typically included [5]. ...
Casting is an especially flexible process that can be utilized by foundries for production on a large scale. Due to their importance as a source of castings, foundries now play a significant role in the industrial sector. The production of excellent castings at the lowest possible cost is the ultimate aim of the manufacturing sector. Undesirable imperfections in the metal casting process are known as defects. A number of issues that are process-related are the reason for the defects. A few defects can be tolerated while others can be fixed, or they can even be eliminated with good moulding technique. These imperfections develop as a result of a few production cycle processes that are not effectively monitored. Sand casting company efficiency is negatively affected by poor casting. For strong castings, the challenging casting defect conditions must be identified and reduced. By reducing casting defects throughout manufacturing, the foundry sector can improve its level of quality. The primary objectives of this study are to identify the significant sand casting defects and analyze the preventative measures to reduce the defects. In this work, efforts are undertaken to identify technically feasible remedies for minimizing a variety of casting weaknesses and improving casting quality.
... As far, remain noticed that cost of quality can be effective tool (technique) that will be useful for evaluating the success of a quality management program (Jaju et al. (2009), for developing of a sophisticated quality management system (Pricket and Rapley, 2001), as a metric to measure the overall performance of the company (Lari and Asllani, 2013), and as a cash flow in the evaluation of the present worth of a new product, during pre-launch planning (Guinot et al., 2016). ...
Purpose
This study aims at presenting deeper insights regarding the understanding and application of the quality costs (CoQ) in the automotive manufacturing industry. The empirical research included three general determinants: reasons for, difficulties during and benefits from implementing quality costs, as well as two specific determinants: measuring and evaluating quality cost elements.
Design/methodology/approach
The empirical research methodology employs the expert evaluation method – the Delphi method, using a survey questionnaire comprising a total of 200 questions, and answered by 9 companies.
Findings
The survey results showed that companies do recognize the reasons for implementing quality costs as a need arising from the quality management standards, the lack of knowledge of quality costs by employees and management as the biggest difficulty while the biggest benefit includes the quality costs enhance the company competitiveness. The costs competence and qualification, the quality management system costs, the costs for improvement, the production control costs, the input control costs, the new measuring and control equipment calibration costs, the costs related to scrap, repairs and product finishing are the most significant elements of the quality costs.
Research limitations/implications
This study is limited by the small number of surveyed companies from the automotive cluster.
Practical implications
The proposed quality costs model provides to the management to conceive CoQ elements as possible drivers in the improvement process of product quality. The structure and the nature of the CoQ elements is expected to advance the process of detailing the quality costs elements.
Originality/value
The novelty of this paper refers to development of a generic quality cost model, whose relevance is confirmed by the structuring of the model with elements published in literature and validating in research companies.
... Quality costs (CoQ) measurement (prevention costs, appraisal costs, failure costs) is one of the most critical and influential tools for assessing the success of total quality management programs in industrial enterprises (Jaju et al., 2009). It assists various departments in measuring performance reports, rationalizing decisions, and evaluating strategic objectives, planning, and budgeting. ...
This paper aims to determine the level of awareness and implementation of measuring CoQ in MIEs in Yemen. In contrast, this study was based on the traditional CoQ Prevention—Appraisal—Failure (PAF) model. Also, this paper proposes a suitable model for measuring CoQ in MIEs based on the research results. The Applied research focused on large companies where CoQ programs in the majority of companies operate as a subsystem of underlying management. Managers of large companies use indicators to control and evaluate performance for production quality. Still, they usually do not develop a separate framework for measuring and assessing CoQ. As a result, this research attempted to answer the question, Are Yemeni industrial companies interested in measuring, analyzing, and reporting CoQ items (prevention, appraisal, and failure costs) concerned in their industry? It also determines the extent these companies are interested in measuring, and analyzing hidden CoQ. According to this research findings, most major companies in Yemen are aware of and practice measuring CoQ. At the same time, the study showed that these companies are still not interested in measuring the hidden CoQ in their manufacturing.
... Many researchers have published studies correlating the quality costs categories, correlating the categories with the total quality costs, as well as with the level of quality [23], [24], and [25]. It is worth noting that the quality costs categories contain specific elements of the quality costs dependent on the nature of the company, its size, the type of products it produces, the organizational and technological conditions, and other considerations. ...
The primary objective of this paper is to find out whether we can use the quality cost model as a tool for visualizing the quality targets in the quality management using the quality costs. The analysis showed that a graphic interpretation of the quality costs model in the companies makes the quality targets “more visible” and “more representative”. The visualization of the quality costs model focuses the efforts of management to use the graphic interpretation of the quality costs for the purposes of visibility, monitoring, comparison with the quality targets at the company level, and beyond during negotiations.
... Kalite maliyetlerinin ölçülmesi, Toplam Kalite Yönetimi'nin önemli bir boyutudur (Jaju et al., 2009). Toplam kalite yönetimi, ürün, süreç ve hizmetlerin kalitesini sistematik ve sürekli olarak iyileştirmeye odaklanan organizasyon çapında bir felsefe ve problem çözme metodolojisidir (Ittner & Larcker, 1995). ...
... Toplam kalite yönetimi, ürün, süreç ve hizmetlerin kalitesini sistematik ve sürekli olarak iyileştirmeye odaklanan organizasyon çapında bir felsefe ve problem çözme metodolojisidir (Ittner & Larcker, 1995). Kalite maliyet bilgileri, önleyici ve düzeltici faaliyetler için önemli fırsatları belirtmek amacıyla kullanılmakta ve kalite yönetim sisteminin güçlü ve zayıf yönlerini belirlemeye yardımcı olmaktadır (Jaju et al., 2009;Campanella, 1999). ...
AN EXAMINATION OF QUALITY COSTS FROM A PROFITABILITY PERSPECTIVEAND AN APPLICATION IN AN IRON AND STEEL COMPANY
ABSTRACT
In an intense competitive environment, the most important factor to gain advantage and to increaseprofitability for many businesses is quality. Quality costs are important criteria in ensuring quality. Quality costs, which have been used widely in recent years, have a significant influence on profitability and productivity of enterprises. In this study, our aim is to see its effect on the profitability of an enterprise in the Iron and Steel industry in Turkey, by examining quality costs, within the framework of Feigebaum’s PAF Model. In this study, the data from 2016 and 2017 are used, and the "Case Study Method" is preferred because it allows an in-depth review and tangible data.
Keywords: Quality, Quality Costs, The PAF Model
... According to Jaju et al., (2009), the cost of quality is a critical success factor for quality improvement and competitiveness in the business world; many firms feel that their existing ways to calculate quality costs are ineffective or non-existent. Tye et al., (2011) contend that cost of quality measurement should be part of a firm's quality management program. ...
A methodology was devised to measure the hidden cost of poor quality at construction projects and it was successfully tested on two projects to bring down the Cost of poor quality.
... The methodology for management with quality costs should serve as a tool to make informed management decisions, while helping plan and forecast, in all stages of product creation (design, manufacturing, use, and disposal of used products in the form of waste), in order to achieve minimal total costs of quality and the lowest possible sensitivity of the product to external influences, which would lead to a sustained quality levels and increased company profits. The development of the methodology for management with quality costs (figure 1) begins with an Algorithm for Introducing and Implementing the System for Management with Quality Costs, also applicable and flexible from the point of view of the different maturity levels of the quality and the quality costs of companies, structured using the well-known trilogy of Joseph M. Juran (Quality Planning, Quality Control and Quality Improvement) (Godfrey and Kenett 2007) and Deming's quality cycle -PDCA (Plan Do, Check, Act), (Sokovic et al., 2009) presented on figure 2. The new trends of the 21 st century necessitate a shift towards a visionary approach to the understanding of quality costs and the management with quality costs, which should integrate the technical and technological aspects, the environmental aspect, and the innovation aspect into the existing knowledge of quality costs (Jaju, Mohanty, and Lakhe (2009). Table 1 presents the characteristics of the classical, the modern and the visionary approach to quality costs (Tomov and Velkoska 2021;. ...
... As literature review indicated, many studies in recent years have underlined the importance and application of the Kano model in studying customer satisfaction/dissatisfaction (Dalton, 2019;Go et al., 2018;Lo et al., 2016;Shahin and Janatyan, 2015;Madzik and Kormanec, 2018) and cost of quality (PAF model) as effective means towards improving the strategic position of firms in the market (Modhiya and Desai, 2016;Farooq et al, 2017;Jaju et al, 2009). In this study, the Kano and PAF models were applied simultaneously to analyze the value of products from the viewpoint of the customers. ...
Purpose
In this study, an integrative approach of customer satisfaction and cost of quality has been proposed for the value analysis of products based on a cost–benefit ratio.
Design/methodology/approach
For the integrative approach, Kano and prevention-appraisal-failure (PAF) models have been applied. By the proposed approach, the value of products can be analyzed according to customer viewpoints and cost of quality. Four products of a home appliance company have been used to examine the new approach.
Findings
Findings indicate the priorities of the studied products as stove, TV, fridge and washing machine, respectively. Such a set of prioritized products plays a strategic role in the competitive advantage of the studied company.
Research limitations/implications
In this study, the weights of the cost of quality items have been assumed as equal. Also, the costs of quality items were limited to the most important ones at the studied company. However, more cost of quality items might be considered in different case studies.
Originality/value
In this study, the Kano and PAF models have been considered simultaneously for product value analysis from the viewpoint of customers. In addition to the classic method of value analysis which is merely based on previous events, the proposed approach is typically proactive.
