09 Mar 2019

How To Reduce The Cost of Poor Quality Effectively By Strategy?

How To Reduce The Cost of Poor Quality Effectively By Strategy?

Businesses and organisations take quality for granted until they face a disruption in the business or operations. We hesitate to invest in anything to make quality better, but avoiding this investment is a misconception, as the cost incurred for a failure due to poor quality is greater in magnitude. You actually put at risk whatever you have gained over time.

According to some researchers the cost of poor quality goes up as high as 15% to 20% of the sales revenue. Some touch 40%, however, the cost of poor quality should be on 10% to 15% of the cost of operations normally. But to substantially lower this cost you need to invest in an effective quality management software. It will see to quality compliance parameters & contribute to the profits of the organisation.

Cost of poor quality is measurable when management defines the goals and measurements. It really means to measure the requirements to get a work done right at the very first time.

Some key strategies that can be adopted to reduce the cost of poor quality are,

Create a Process of Closed Loop Corrective Action

The QMS software can trace corrective actions generated internally or externally and support planned tasks. The closed loop corrective action process eliminates the possibility lost paper documents, validates data against master records accurately and speeds up the corrective action process, which is electronically recorded and easily retrieved.

Inspection Process Has To Be Streamlined

Streamlining the inspection process removes paper documents and standardizes quality. The inspection process is enhanced by automation of audit to verify critical process compliances and helps meet objectives.

Supplier Related Quality Management

Cost of poor quality also originates from supplier related activities. The QMS software can identify and hold suppliers accountable for poor performance.

Quality Audits To Be Automated

Using the QMS software solution compliance to standards and regulations can be tracked efficiently & effortlessly. The solution enables QMS team to define several types of internal and external audits. Use it to identify con-conformances early in the process.

Quality Metrics Should Be Set Up

The QMS solution can provide an interactive dashboard containing key quality metrics. It can integrate quality related data with cost data from the ERP system to provide metrics. This helps support analysis and transparent view of cost of poor quality.

An overall perspective and holistic approach is needed to reduce the cost of poor quality, by aggregating all issues throughout the company. It helps define preventive measures and then map it to the end of the process.

Aura quality management solutions is a superlative web-based QMS software that aims to keep organisations profitable over a long time. Management of Non-Conformance (NCM) is an integral part of this QMS platform. Aura QMS is scalable and is geared to meet future requirements of most companies from a wide range of industries. For more information and a demo, simply leave us an enquiry. or please visit