COQ
Finance
COQ (Cost of Quality)
Cost of Quality
Total cost of prevention, appraisal and internal/external failure associated with achieving and not achieving quality.
Examples
- 01The COQ report splits quality costs into prevention, appraisal, internal failure and external failure, totalling 4.5 % of sales.
- 02Management reviews COQ quarterly and sees that more spending on prevention has cut external failure costs by a third.
- 03When an inspection is removed after a process is made capable, the COQ report shows the lower appraisal cost the next quarter.