Converting Defect % into Monetory Terms

by Irvine Choolo
(Tokyo, Japan)

is there any simple way to convert defect % into monetory terms so that top management can easily understand...talking the language of business.

  1. QAS Home
    2. >
  2. Forum
    3. >
  3. Converting Defect %

Comments for Converting Defect % into Monetory Terms

Average Rating starstarstarstarstar

Click here to add your own comments

Rating
starstarstarstarstar 		Capturing Costs
by: Robert Broughton

Many companies struggle with this. You need to classify defects and assign monetary value to those defects. Some tips...
1) Cost of the defects depend on the process step. The earlier you catch the defect, the less the cost to the company.
2) Once the monetary cost is establish, do not change the cost. This helps for long term tracking.
3) When establishing the costs, start with the defects that are causing the most problems. With a Pareto chart work your way down the defect list.
4) Get into this cycle...As you find any new defect, immediately assign a cost.
5) Graph the monetary cost of the defects with a Pareto chart. Compare this monetary Pareto chart to the count of defects Pareto chart. With this you may find you need to re-prioritize your defect reduction goals.


Robert Broughton
Quality-Assurance-Solutions.com

Click here to add your own comments

Join in and write your own page! It's easy to do. How? Simply click here to return to Quality Discussion Forum.

Enjoy this page? Please pay it forward. Here's how...

Would you prefer to share this page with others by linking to it?

  1. Click on the HTML link code below.
  2. Copy and paste it, adding a note of your own, into your blog, a Web page, forums, a blog comment, your Facebook account, or anywhere that someone would find this page valuable.
© Copyright Quality-Assurance-Solutions.com

All Products

Software, Videos, Manuals, On-Line Certifications

QAS Business Slide Deck

450+ Editable Slides with support links

8D Manager

Corrective Action Software

TrainingKeeper Software

Plan and Track Training

Snap Sampling Plans!

AQL Inspection Software

TRIZ Kit

Learn and Train TRIZ