The levels of cost and coordination increase greatly if the problem is not detected until right before the handoff to the customer, which can see the repair costs skyrocket. Still, the cost of finding an error at this point is often manageable, though not preferred to immediate identification. More time and coordination will be required. Once a part or service moves on to a different department, it becomes more expensive to fix. The repair does not involve much disassembly, or multiple departments, and the tools for repair are often present. When an error is detected immediately, the cost is typically smaller. These costs can be calculated by determining what was required to repair the defect and what was impacted within the main process flow when time and resources had to be spent on the repairs.

The cost varies depending on how far the product or service goes along the process before being detected. The customer trusts that the competitor’s product will work right the first time.”Īn overview: What is cost of poor quality (COPQ)?Ĭost of poor quality, or COPQ, is both the direct and indirect costs associated with the defects generated by a process. Our competition’s products don’t have the same quality issues. Our competition is on schedule to have a similar product in four months, and the customer is going with them. They want us to deliver a product on time that works the first time. “The customer doesn’t want us to have better repair processes. Tell them we will send out service techs to repair the product on-site.” To put it in simple terms, they just don’t trust us to deliver a quality product.”

The numbers were worse two years ago, when we launched the product. One in four products have to be returned for repair within the first year in service. The current product we sell them continues to this day to have quality problems. “So, why is this a problem? Why won’t they sign the contract?” I’ve thrown every tool at my disposal to get this customer to order the new product. The director of business development sat in the CEO’s office with a weary face. Definition of Cost of Poor Quality (COPQ): « Back to Glossary Index

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