Cost of Poor Quality Analysis

What?

Cost of Poor Quality is the cost incurred in a process due to non first time right products.
                                                  Cost of Poor Quality = 1 – RTY
                                                                       Where RTY = Rolled Throughput Yield


Why?

1. It helps to estimate the Rolled Throughput Yield and room for improvements
2. It helps to determine the most defect or rework or poor Quality contributing parts of the overall process
3. It helps to prioritize which part of the overall process needs prior attention based on the poor Quality or rework contribution


When?

1. When flowcharting the overall process
2. When identifying the poor Quality or rework contributing parts in a process
3. When identifying problems and areas of improvements