Improving performance: quality costs with a new name?

Abstract

Juran defined the basic quality problem as “to strike the optimum balance between cost of quality and value of quality for each quality characteristic and to do so in the lower levels of organisation”, explaining that increased conformance reduces the losses which are due to defectives but “the cost of the controls needed for greater conformance rises geometrically as perfection is approached”. Various subsequent models and figures often report, in a dollar measure, the “value” of costs and cost savings. Despite the passing of time since Juran’s explanation that not only dollars can be balanced against dollars but sometimes other measures are just as important, there is often a concern that the real indicator of performance will be what affects the bottom line. This paper discusses different approaches to dealing with the cost of quality and how organisations are attempting to improve performance. The most interesting observation is that what we know as quality costs is clearly being applied successfully under different guises and different names.

Citation

Keogh, W., Dalrymple, J.F. and Atkins, M.H. (2003), "Improving performance: quality costs with a new name?", Managerial Auditing Journal, Vol. 18 No. 4, pp. 340-346. https://doi.org/10.1108/02686900310474352