The Importance of Quality Costs

General Management must take into account the role of costs in respect of quality, given that involve many aspects that can not be neglected. Significant points out that Ricardo Jiménez Aguado, the cost of quality is not only an absolute measure of performance, its importance lies in indicating where it will be more profitable corrective action for a company. In this regard, several studies, authors and companies indicate that quality costs represent about 5 to 25% on annual sales. These costs vary depending on the type of industry, circumstances in which it is the business or service, the vision that the organization has about the costs relating to the quality, degree of progress in overall quality and improvement experiences processes. About 95% of quality costs are disbursed to quantify the quality and to estimate the cost of failure. These expenses add up to value of goods or services paid by the consumer, although the latter only seen in the price, they become important to him, when from the information obtained, the faults are corrected or reduce the failures and rework, and as a result of these savings will decrease prices.

For his part, Nelson Pagella gives us, is meant by Quality costs money intended to obtain the required quality. The Cost of Quality System provides criteria for information that can be used by the Directors of the Company to analyze the economic impact the quality or lack thereof in the performance of the organization and verify the progress made as a result of actions aimed at continuous improvement as it is said that the fundamental objective of a Quality Cost System is to ensure that the manufacture of a product, to successfully meet predetermined requirements of the customer and society, with minimal cost, helping to maximize the profits of an enterprise

Importance, definition, scope companies definitely need to be fully identified in the present with what brings quality, especially in the conquest of markets, customers should satisfy my TONAR into account all costs involved as well as those of not quality (Topic for another written test). This need gives us Aguado Ricardo Jimenez, currently, are understood as those incurred quality costs in the design, implementation, operation and maintenance of quality systems of an organization, those costs of the organization engaged in continuous improvement processes quality, and cost of systems, products and services that have failed or frustrated by not having success in the market than expected. While it is true that there are unavoidable costs, because they are typical of production processes or indirect costs so that they are performed, some authors, in addition to these expenditures, distinguish two types of costs: the 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 poor 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, as for example, rework, scrap, returns, repairs, replacements, care expenses claims and guarantees compliance requirements, among others.

On the other hand, others include both under the concept of quality costs. Under this approach, the costs relating to the quality may involve one or more departments of the organization, as well as service providers or subcontractors, as well as means of delivering the product or service This means that they are not exempt from liability the areas of sales, marketing, design, research and development, purchasing, warehousing, materials handling, production, planning, control, installation, maintenance and service and so on. Hence, to the extent you see the cost of wider quality, depend on its importance and weight within the administration of a business or its impact on processes aimed at improving the overall quality. Measuring quality cost respect said to generally measuring quality costs is directed to high impact areas and identified as potential sources of cost reduction. Those who to quantify the development and provide a basis for comparing inner products, services, processes and departments. The measurement of quality-related costs also reveals deviations and anomalies in distribution of costs and standards, which often are not detected in routine analytical work.

Finally, and perhaps the most important use, quantification is the first step towards 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 the company directly or indirectly contribute to achieve, maintain and improve product quality , processes and services. The system must have a monthly assessment. It is further desirable that management analyze weekly internal losses incurred costs in order to take corrective and preventive actions. Consider that in general will? Area of ​​Quality responsible for the information on the cost of quality is available, but should be the responsibility of all areas to provide the information to produce reports Some benefits are: - Reduction of manufacturing costs. - Improved management. - Reduction of scraps. - Improved planning and programming activities. - Improved productivity. - Increase the utility or benefit. - Satisfaction of doing the job right from the beginning.

Definitely, quality costs are an integral part of the cost of production, being present in the results that are reflected in the income statement of an organization, but not quantified separately, which prevents adequate control and analysis, making the application possible corrective action and decision-making process

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