Which of the following is true about how quality improvements affect the cost of

Question

Which of the following is true about how quality improvements affect the cost of quality?
A) Some managers believe they should eliminate all failure costs and have zero defects.
B) Quality improvements affect the cost of quality.
C) In successful quality programs, companies decrease the cost of quality.
D) COQ reports provide less insight about quality improvements when manager compare
trends over time.
E) COQ reports provide more insight about quality improvements when managers compare
trends over time.

Explanation / Answer

E) COQ reports provide more insight about quality improvements when managers compare trends over time.

the cost of quality (COQ) is of more strategic and economic importance than previously conceived. Whereas previous works have applied COQ as an internal performance measure within companies, the purpose of this paper is to present a model for supply chain design that computes the COQ as a global performance measure for the entire supply chain. In addition, rather than assume an exogenously given COQ curve, our model computes COQ in terms of internal operational decisions such as the error rate at inspection and fraction defective at manufacturing. The model can be used to design a logistic route that achieves a minimum total cost while maintaining an overall quality level and to evaluate the impact of investment in quality to increase overall profits

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