Cost of Quality
COQ
Cost of quality considers both costs incurred to ensure quality and costs arising from unmet requirements.
Other learning contexts (3)
In context
It can be divided into prevention, appraisal, internal failure, and external failure costs. These categories support improvement decisions and do not automatically match accounting rules.
Example
If reducing inspection costs increases losses after shipment, the overall cost of quality may worsen.
Key distinction
Distinguish one department's cost savings from improvement across the organization.
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