Steve and Sherry

Colorado Springs Real Estate

Cutting Costs

While it is true that there are unavoidable costs, because they are own production processes or indirect costs that they are performed, some authors, in addition to these expenditures, distinguish two types of costs, cost of quality itself, which is derived from the organization’s efforts to manufacture a product or generate a quality service offered, the “cost of non quality”, also known as the “price of default” or the cost of getting things wrong or incorrectly. The latter is defined as those expenses caused by inefficiencies or failures, which are avoidable, for example, rework, scrap, returns, repairs, replacements, care costs to complaints and enforcement of security requirements, among others. On the other hand, others include both the concept of cost of quality.

In this perspective, the costs associated with quality may involve one or more departments of the organization and services to suppliers or contractors, as well as to the means of delivery of the product or service This means that they are not without responsibility across sales, marketing, design, research and development, purchasing, warehousing, material handling, production, planning, control, installation, maintenance and service, etc. Hence, as far as you watch widely as the cost of quality, their importance and weight depend specifically within a business administration or their impact on processes aimed at improving the overall quality. Measuring quality costs is said to regard generally measuring quality costs is directed to high impact areas and identified as potential sources of cost reduction.

Those that can quantify the development and provide an internal source of comparison between products, services, processes and departments. The measurement of quality-related costs also reveals deviations and abnormalities in distribution of costs and standards, which often are not detected in routine work of analysis. Finally, and perhaps most important use, quantification is the first step toward the control and improvement. Benefits of quality costs Pagella Nelson gives us some who have a powerful and very positive impact in determining and consider that all sectors of company directly or indirectly contribute to achieve, maintain and improve the quality of products, processes and services.

The system must have a monthly assessment. There is also a week that management analyze the costs caused by internal losses in order to take corrective and preventive actions. Consider that in general the Quality Department will be responsible for that information on the cost of quality is available, but should be the responsibility of all areas to provide the information to prepare reports Some benefits are: – Reduced costs manufacturing. – Improved management. – Reduction of scraps. – Improved planning and scheduling of activities. – Improved productivity. – Increase the utility or benefit. – Satisfaction of doing the job right from the start. Definitely, the costs of quality are an integral part of production cost, being present in the results as reflected in the income statement of an organization, but not quantified separately, preventing their proper control and analysis, and hindering the implementation of any remedial measures and decision-making process

 

Both comments and pings are currently closed.

Comments are closed.