COST OF QUALITY

The old saying “When the going gets tough, the tough get going” is probably most apt to describe the current situation that many organizations are facing. Rather, it is the smart that get going. Among the many ways in which Covid-19 has affected the economy the one that affected each and every organization, is the huge pressure on consistency of revenue coupled with uncertainties. The prices of raw materials are on the rise, the overall sentiment of the economy is mixed, and the prospects for interest rates going up is matter of time, all of which are clear pointers that the profit margins are under enormous pressure.

All the products these days, are available with a wide variety of choice to the customers with many companies on the play field and any increase in the prices might lead to loss of customer base. The companies must maintain their margins and hold on to their customers at the same time. In this situation, it becomes imperative that the companies find out and reduce all the costs that do not add value to its products.
Here comes, Cost of Quality, the tool that will help companies achieve the above objective.

Cost of Quality (CoQ) is a methodology used to define and measure where and what amount of an organization’s resources are consumed due to “Lack of Quality”.