Professional Documents
Culture Documents
Cost of Poor
$120.00
$100.00
$80.00
$60.00
$40.00
$20.00
$-
Jan Feb Mar Apr May Jun Jul Aug Sep
Year 1
Challenges:
st of Poor Quality (CoPQ) Management
COPQ as % of Revenues
e Costs Overtime
10
50 60
40 70
30 80
20 90
10 100
Challenges:
gement
Starting Point
10
50 60 50 60
70 40 70
80 30 80
90 20
28% 90
100 10 100
Blank Area
Summary and Conclusion:
Challenges:
d
0
Cost of Poor Quality (COPQ) Management
In d ivid u al F ailu r e C o st Tr e n d s (m illio n s)
Total Failure Cost by Month Failure Cost Breakdown by Percentage of Total 3 Year Costs Total Internal Failure Costs by Site by Month Total Internal Failure Costs by Site by Product and by Month
$120.00
$12 0.00
$4 0.00
$20.00
$2 0.00
$- $-
Jan Feb Mar A pr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep O ct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Year 1 Year 2 Year 3
Year 1
Conclusion: Conclusion: Conclusion: Conclusion:
$300.00
Distribution of Total Failure Costs Overtime $300.00
Total Failure Costs
$250.00 $250.00
$200.00 $200.00
$150.00 $150.00
$100.00 $100.00
$50.00 $50.00
$- $-
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Year 1 Year 2 Year 3
Conclusion:
Cost of
Cost Category
Q1
Controversial Costs $ 9.8
Inclusion of overhead on top of direct costs $ 9.80
Internal Failure Costs $ 327.7
Remediation $ 164.85
Rework $ 117.43
Scrap/ Spoilage $ 26.40
Nonconformances (NCR, CAPA, SCAR) $ 19.00
External Failure Costs $ 235.8
Post Market Surveillance (Complaints) $ 186.02
Field Corrective Actions (FCA) $ 3.01
Holds $ 1.50
Recalls $ 0.74
External Inspections/Audits $ -
Agency Observations / WL $ 38.10
Liability $ 5.00
FDA/MOH Communications $ 1.48
Opportunity Costs $ -
Cost of regaining lost customers (measureable campaigns) $ -
Lost sales what could be regained $ -
Revenues $ 20,000.0
COPQ as % of Revenues 2.9%
Q2 Q3 Q4 Total - Year 1 Q1 Q2
$ 12.3 $ 10.0 $ 9.4 $ 41.4 $ 9.8 $ 12.3
$ 12.25 $ 9.95 $ 9.40 $ 41.40 $ 9.80 $ 12.25
$ 262.1 $ 217.7 $ 198.7 $ 1,006.2 $ 278.9 $ 262.1
$ 124.27 $ 71.47 $ 68.38 $ 428.97 $ 146.85 $ 124.27
$ 105.15 $ 103.54 $ 97.65 $ 423.79 $ 98.73 $ 105.15
$ 15.90 $ 22.20 $ 15.90 $ 80.40 $ 15.60 $ 15.90
$ 16.80 $ 20.44 $ 16.80 $ 73.04 $ 17.70 $ 16.80
$ 167.3 $ 199.7 $ 167.0 $ 769.7 $ 188.3 $ 167.3
$ 165.72 $ 180.72 $ 165.72 $ 698.17 $ 155.02 $ 165.72
$ 0.00 $ 8.00 $ 0.00 $ 11.02 $ 3.01 $ 0.00
$ - $ 9.00 $ - $ 10.50 $ - $ -
$ 0.34 $ 0.34 $ 0.34 $ 1.77 $ 0.05 $ 0.34
$ - $ - $ - $ - $ - $ -
$ 0.30 $ 0.20 $ - $ 38.60 $ 29.20 $ 0.30
$ - $ - $ - $ 5.00 $ - $ -
$ 0.90 $ 1.39 $ 0.90 $ 4.67 $ 1.08 $ 0.90
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
Q3 Q4 Total - Year 2 Q1 Q2 Q3
$ 10.0 $ 9.4 $ 41.4 $ 9.8 $ 12.3 $ 10.0
$ 9.95 $ 9.40 $ 41.40 $ 9.80 $ 12.25 $ 9.95
$ 217.7 $ 198.7 $ 957.4 $ 327.7 $ 262.1 $ 217.7
$ 71.47 $ 68.38 $ 410.97 $ 164.85 $ 124.27 $ 71.47
$ 103.54 $ 97.65 $ 405.09 $ 117.43 $ 105.15 $ 103.54
$ 22.20 $ 15.90 $ 69.60 $ 26.40 $ 15.90 $ 22.20
$ 20.44 $ 16.80 $ 71.74 $ 19.00 $ 16.80 $ 20.44
$ 199.7 $ 167.0 $ 722.2 $ 235.8 $ 167.3 $ 199.7
$ 180.72 $ 165.72 $ 667.17 $ 186.02 $ 165.72 $ 180.72
$ 8.00 $ 0.00 $ 11.02 $ 3.01 $ 0.00 $ 8.00
$ 9.00 $ - $ 9.00 $ 1.50 $ - $ 9.00
$ 0.34 $ 0.34 $ 1.07 $ 0.74 $ 0.34 $ 0.34
$ - $ - $ - $ - $ - $ -
$ 0.20 $ - $ 29.70 $ 38.10 $ 0.30 $ 0.20
$ - $ - $ - $ 5.00 $ - $ -
$ 1.39 $ 0.90 $ 4.27 $ 1.48 $ 0.90 $ 1.39
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
Cost Category Q1
Appraisal Costs $ 36.0
Quality / Service internal audits $ 36.00
Supplier Audits/Evaluations $ -
Depreciation $ -
Calibration $ -
Inspection $ -
Field Servicing $ -
Prevention Costs $ -
Preventive Maintenance $ -
Process Planning/ Control $ -
Training $ -
Supplier Development Management $ -
Improvement Costs $ -
New software, tools, and/or technology implemented $ -
Coaching/Mentoring $ -
Improvement Projects $ -
Q2 Q3 Q4 Total - Year 1 Q1
$ 36.0 $ 36.0 $ 36.0 $ 144.0 $ 36.0
$ 36.00 $ 36.00 $ 36.00 $ 144.00 $ 36.00
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
Q2 Q3 Q4 Total - Year 2 Q1 Q2
$ 36.0 $ 36.0 $ 36.0 $ 144.0 $ 36.0 $ 36.0
$ 36.00 $ 36.00 $ 36.00 $ 144.00 $ 36.00 $ 36.00
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
3.40 9.80 4.50 3.70 4.05 12.25 3.35 3.90 2.70 9.95
32.90 104.50 27.80 31.30 16.10 75.20 10.60 6.40 5.90 22.90
17.68 60.35 16.69 16.19 16.19 49.07 16.19 16.19 16.19 48.57
33.45 104.43 33.45 33.45 33.45 100.35 34.14 30.45 30.45 95.04
4.10 7.90 0.10 0.10 0.10 0.30 2.60 0.10 0.10 2.80
1.50 5.10 1.50 1.50 1.50 4.50 2.70 1.50 1.50 5.70
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.30 19.80 5.30 5.30 5.30 15.90 11.10 5.30 5.30 21.70
0.10 6.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.50 0.00 0.00 0.50
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.60 19.00 5.60 5.60 5.60 16.80 9.24 5.60 5.60 20.44
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
24.70 76.00 24.70 24.70 24.70 74.10 28.70 29.70 27.70 86.10
30.54 104.52 30.54 30.54 30.54 91.62 33.54 30.54 30.54 94.62
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 5.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 3.01 0.00 0.00 0.00 0.00 1.00 0.00 0.00 1.00
0.00 0.00 0.00 0.00 0.00 0.00 7.00 0.00 0.00 7.00
0.00 1.50 0.00 0.00 0.00 0.00 9.00 0.00 0.00 9.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.11 0.74 0.11 0.11 0.11 0.34 0.11 0.11 0.11 0.34
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.10 38.10 0.10 0.10 0.10 0.30 0.10 0.10 0.00 0.20
0.00 5.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.30 1.48 0.30 0.30 0.30 0.90 0.79 0.30 0.30 1.39
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12.00 36.00 12.00 12.00 12.00 36.00 12.00 12.00 12.00 36.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Oct Nov Dec Q4 Total Total Annual Costs
3.40 9.80 4.50 3.70 4.05 12.25 3.35 3.90 2.70 9.95
32.90 92.50 27.80 31.30 16.10 75.20 10.60 6.40 5.90 22.90
16.68 54.35 16.69 16.19 16.19 49.07 16.19 16.19 16.19 48.57
29.45 86.73 33.45 33.45 33.45 100.35 34.14 30.45 30.45 95.04
4.10 7.50 0.10 0.10 0.10 0.30 2.60 0.10 0.10 2.80
1.50 4.50 1.50 1.50 1.50 4.50 2.70 1.50 1.50 5.70
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.30 15.00 5.30 5.30 5.30 15.90 11.10 5.30 5.30 21.70
0.10 0.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.50 0.00 0.00 0.50
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.60 17.70 5.60 5.60 5.60 16.80 9.24 5.60 5.60 20.44
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
24.70 71.00 24.70 24.70 24.70 74.10 28.70 29.70 27.70 86.10
24.54 78.52 30.54 30.54 30.54 91.62 33.54 30.54 30.54 94.62
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 5.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 3.01 0.00 0.00 0.00 0.00 1.00 0.00 0.00 1.00
0.00 0.00 0.00 0.00 0.00 0.00 7.00 0.00 0.00 7.00
0.00 0.00 0.00 0.00 0.00 0.00 9.00 0.00 0.00 9.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.02 0.05 0.11 0.11 0.11 0.34 0.11 0.11 0.11 0.34
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.10 29.20 0.10 0.10 0.10 0.30 0.10 0.10 0.00 0.20
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.30 1.08 0.30 0.30 0.30 0.90 0.79 0.30 0.30 1.39
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12.00 36.00 12.00 12.00 12.00 36.00 12.00 12.00 12.00 36.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Oct Nov Dec Q4 Total Total Annual Costs
3.40 9.80 4.50 3.70 4.05 12.25 3.35 3.90 2.70 9.95
32.90 104.50 27.80 31.30 16.10 75.20 10.60 6.40 5.90 22.90
17.68 60.35 16.69 16.19 16.19 49.07 16.19 16.19 16.19 48.57
33.45 104.43 33.45 33.45 33.45 100.35 34.14 30.45 30.45 95.04
4.10 7.90 0.10 0.10 0.10 0.30 2.60 0.10 0.10 2.80
1.50 5.10 1.50 1.50 1.50 4.50 2.70 1.50 1.50 5.70
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.30 19.80 5.30 5.30 5.30 15.90 11.10 5.30 5.30 21.70
0.10 6.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.50 0.00 0.00 0.50
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
5.60 19.00 5.60 5.60 5.60 16.80 9.24 5.60 5.60 20.44
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
24.70 76.00 24.70 24.70 24.70 74.10 28.70 29.70 27.70 86.10
30.54 104.52 30.54 30.54 30.54 91.62 33.54 30.54 30.54 94.62
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 5.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 3.01 0.00 0.00 0.00 0.00 1.00 0.00 0.00 1.00
0.00 0.00 0.00 0.00 0.00 0.00 7.00 0.00 0.00 7.00
0.00 1.50 0.00 0.00 0.00 0.00 9.00 0.00 0.00 9.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.11 0.74 0.11 0.11 0.11 0.34 0.11 0.11 0.11 0.34
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.10 38.10 0.10 0.10 0.10 0.30 0.10 0.10 0.00 0.20
0.00 5.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.30 1.48 0.30 0.30 0.30 0.90 0.79 0.30 0.30 1.39
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12.00 36.00 12.00 12.00 12.00 36.00 12.00 12.00 12.00 36.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Oct Nov Dec Q4 Total Total Annual Costs
Finance Overhead
Operations Equipment
Operations Part(s)
Obsolete Material
Operations
Finance Disposal
Finance Travel
Accomodations
Compliance Agency Observations
Testing
Finance
Equipment/Parts
Operations Calibration
Fee charges
Functions responsible for obtaining cost information
Finance
Lawsuits
Legal
Value of Quality (VOQ) Management
Office Supplies
Finance
Marketing Advertisement