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In Summary: QA, QC, and Cost of Quality

In Summary: QA, QC, and Cost of Quality

Quality control, quality assurance and quality management systems

To define the difference between quality assurance and quality control, one needs to understand two basic terms.
First, many believe that quality assurance and quality control are actually the same thing, in fact even manufacturers often use the terms quality assurance and quality control interchangeably. Rather, as this article explains, quality assurance occurs upstream at the beginning of a manufacturer's product development project, while quality control occurs downstream during or even after production.
Second, quality assurance and quality control are part of a manufacturer's overall, overall quality system, also known as a quality management system (QMS). According to ISO 9000:2015: "Quality Management Systems - Basics and Terms", a QMS is a compilation of business processes, methods, guidelines, documented information and tools that run through an entire company.

A QMS, when properly implemented, is designed to reassure, if not guarantee, internal stakeholders, customers, supply chain partners, regulators and others that the company's products or services consistently meet the quality requirements and demanding standards of a particular market correspond.
A QMS is vital when it comes to reducing the Total Cost of Quality (COQ), which includes the total cost of preventing and correcting poor quality. According to the American Society for Quality (ASQ), some manufacturers have quality-related costs as high as 40 % of gross sales
Unfortunately, as the trade journal Quality Digest points out, most executives believe their company's COQ is less than 5 %, or worse, they don't even know what it is.
For example, suppose a manufacturer has gross sales of $100 million. If 20 % of sales are affected by quality issues, that's nearly $20 million a year -- or about $77,000 a day. That's a lot of money.
Although quality assurance and quality control are fundamentally different, both play a major role in lowering a company's COQ.
So let's take a look at the differences between quality assurance and quality control.

What is Quality Assurance?

Quality Assurance is a proactive, process-based method of preventing quality control issues in products and services before they are developed and deployed. In summary, quality assurance should therefore be viewed as a preventive measure.

Manufacturers implement quality assurance by planning and documenting the quality assurance process.
Once the process is fully mapped and implemented, periodic audits are typically also performed to verify compliance with the quality assurance process and to identify opportunities to improve it.
In Summary: QA, QC, and Cost of Quality3

What is quality control?

Quality control takes place after the quality assurance process has been established. In contrast to quality assurance, which is based on structure and effective planning, quality control is product or service-related. The primary goal of a quality control process is to ensure that a product or service is free from defects and meets quality requirements.
In a way, therefore, quality control should be seen as a more reactive method. The reason? While quality assurance plans how high-quality products or services can be produced or provided, quality control identifies defects in the finished products/services and helps to correct them before delivery to the customer. Quality control employs extensive testing and verification procedures to monitor the quality of a manufacturer's products.
In Summary: QA, QC, and Cost of Quality4

As you can see from the differences between quality assurance and quality control, when a manufacturer has complete control over their quality assurance, fewer quality problems and costs will occur at the quality control stage. Because if you have quality assurance and quality control under control, you have lower COQ - and thus higher profits.

Costs and Effects of Poor Quality Assurance

Prevention costs

As mentioned earlier, quality assurance is a means of ensuring the manufacture of a quality product or delivery of a quality service. However, good quality also comes with costs. The first type of costs is the prevention costs.
Prevention costs are all costs associated with the development and maintenance of both the overall quality management system and the establishment of quality assurance processes. Prevention costs include: quality and process planning, review of new product specifications, staff training and assessment, quality improvement projects, etc.

When a company's QMS and Quality Assurance are properly in place, the cost of prevention is seen more as an investment in mitigating the significant impact that can result from bringing defective products to market, and thereby as an investment in maintaining profitability.

Appraisal costs

A manufacturer incurs testing costs when suppliers or customers evaluate their purchased parts, materials, products, or services to ensure they meet performance requirements, quality standards, and/or industry regulations.
Examples of appraisal costs are: reviews of purchased materials, quality audits, calibration tests, quality control operations, verification and test reports (both during the process and in final assessments), etc. In short, appraisal costs give customers and suppliers the assurance that products meet their quality standards.
In Summary: QA, QC, and Cost of Quality9

Costs and Impact of Poor Quality Control Procedures

Internal failure costs

Internal failure costs are caused when products and services do not meet quality requirements or do not meet customer requirements. These quality issues are identified before products and services are shipped to customers.

Internal failure costs include:

• Design changes, rework, and re-examination
• Waste, shortages, additional procurement costs
• Vibration sensitive: must be used in a measurement laboratory
• Production Losses and Delays
• Additional labor requirements or redistribution of resources

External failure costs

External failure costs, as the term suggests, arise from defects discovered after a product or service has been delivered to external customers. Aside from the costs associated with external failures, a manufacturer's brand image can be significantly tarnished by perceptions of poor quality and customer dissatisfaction.

External failure costs include:

• handling of complaints
• Customer Support and Technical Support
• warranty claims
• Returns and recalls, including transport costs
• Penalties based on SLA
• repairs and services
• Other Forms of Compensation
• Legal issues with customers, suppliers or regulators
• Public relations costs

Strategies to reduce the total cost of quality (COQ)

The total cost of quality for a manufacturer can be calculated as follows:
Quality Cost = (Prevention Cost + Inspection Cost) + (Internal Failure Cost + External Failure Cost)
It is important to note that investing in costs for good quality does not mean that the total cost of quality increases. Rather, quality costs should decrease with the right investments and optimizations of QMS and quality assurance processes. In addition, to reduce the overall cost of quality, a manufacturer would do well to ensure that the cost of good quality is lower than the cost of poor quality.
By proactively addressing quality from the beginning of the product or service development process, the cost of poor quality will also decrease.

One way a manufacturer can lower their cost of good quality is by incorporating new technologies, such as B. 3D measurements and automated quality control solutions to perform quality assurance and control tasks.
Despite the initial investment, these solutions are proving to be extremely valuable in improving the quality of a wide range of products and helping manufacturers meet the multitude of operational challenges related to quality assurance and control.

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