Cost of Poor Quality: An Effective Strategy to Measure Performance

Quality management is one of the most important aspects of any industry and is of utmost importance in manufacturing industry. There are many tools and methodologies that give us effective quality management with their own pros and cons. COPQ is not just a tool or methodology; it is a way of life. The main idea behind COPQ is to focus on the losses that occur due to poor quality. There are many aspects of COPQ that gives it an edge over other quality measurement strategies.

Normally when we measure the performance we measure the aggregate performance, this leads to balancing out. There will be some parameters which are improving the performance and some will be degrading it, while the aggregate remains balanced. In COPQ we measure only those parameters that are degrading the performance and ignore the others. This gives us measurement of room of improvement possible in the performance.

Another benefit of COPQ is that we measure poor quality in terms of monetary loss that is suffered. Quality is an intangible metric and often it is very difficult to measure in quantitative terms. COPQ solves this problem.

COPQ also solves a very practical problem which I witnessed during a project in JSL Ltd. (Jindal Stainless). There are many departments and their performance is calculated individually. A defect that occurs in the later part of the production line was shown in the performance sheet of that department but the defect was essentially due to an error in the starting of the production line. COPQ attributed that defect to the defect which was actually responsible for it rather on the department where it was found.