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Number of Slides: 123


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Training Presentation/Powerpoint:

Reducing the Cost of Quality (COQ)



As a key factor of competitiveness, you must manage cost all the time, not only in times of economic downturn. Reducing the Cost Of Quality (COQ) program helps achieve this. This training fits well into any cost reduction or process improvement initiative, including Lean management and TQM. The COQ methodology instills a practical approach to quantifying the financial impact of the Cost Of Non-Conformance (CONC) and the Cost Of Conformance (COC). The COQ calculation methods are also used in quantifying the impact of Lean Six Sigma programs. 


By teaching this presentation, you can improve the company culture and improve the bottom line. This presentation changes employees problem solving focus from quick fix solutions to preventing issues before they occur.  This course teaches the skills to prioritize quality improvement opportunities based on the expected financial return. 

Learning Objectives

  • Understand the principles and basic concepts of the Cost of Quality (COQ)

  • Understand how quality improvement reduces costs

  • Calculate COQ and conduct COQ assessments

  • Identify COQ cost drivers within your organization

  • Develop a COQ strategy

  • Use COQ to drive prevention in your organization

  • Apply COQ to manage improvement projects in your organization


1.  Introduction & Basic Concepts of COQ

  • Business case for quality

  • Impact of quality improvement program

  • Link between quality costing and profits

  • Why are quality costs important?

  • Why measure COQ?

  • What is COQ?

  • COQ iceberg model

  • COQ and Lean & Six Sigma

  • COQ program management

  • Key steps in setting up a COQ system

  • Preparation

  • Four phases of a COQ system


2.  Phase 1: Identifying COQ Items

  • PAF model

  • Prevention costs

  • Appraisal costs

  • Failure costs

  • Internal and External failure costs

  • Eight types of waste

  • CONC checklists

  • Guidelines for identifying COQ items

3.  Phase 2: Collecting COQ Data

  • Matching accounts with CONC items

  • COQ data source

  • Quality costing

  • Example calculations of Failure cost, Appraisal cost and Prevention cost

  • COQ scorecard and indices

  • Process flow for COQ reporting

  • Collecting and reporting COQ data

  • Role of Finance and line managers/supervisors

  • Practical guidelines

4.  Phase 3: Analyzing COQ Data

  • Selecting quality cost bases

  • Trends analysis

  • Pareto analysis

  • Variance analysis

  • SMART criteria

  • Set targets for improvement

  • Case study

5.  Phase 4: Reducing COQ & Improving Quality

  • ​Reduce COQ through quality improvement programs

  • Tools and techniques

  • PDCA problem solving

  • System for quality is prevention

  • Some results from industries

  • Sustaining COQ

You may also be interested in the following related documents (sold separately):

  1. Advanced Product Quality Planning (APQP)

  2. 8D Problem Solving Process

  3. PDCA Problem Solving Technique & Tools

  4. Failure Mode & Effects Analysis (FMEA)

  5. Root Cause Analysis

  6. Seven Basic Quality Tools

  7. Seven Advanced Quality Tools

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