The approach to Performance Improvement (in general) and to Quality Improvement (in particular) should always be "economical".
In the quality case, the costs of non-quality (CNQ or NQC) method gives a very valid economic base from which improvement actions can be launched.
this topic is now available in an e-course!!
The topic: Managing the Costs of non-Quality
is dealt with extensively in Carlo Scodanibbio e-course
The essential toolbox for Performance measurement and monitoring in the SME
See full details of this e-course - click here
CNQ are costs that a "quality-performance" would have not incurred.
The CNQ method identifies, measures and monitors the costs that result from failure to meet quality requirements or to comply with quality standards. The CNQ method measures (or approximates) also the lost revenue that a quality performance would or could have generated.
The world-class enterprise has a system in place, separate completely from the accounting system (but possibly linked to its "industrial cost-control system"), by which all CNQ are identified, classified, and measured. The output is the starting point for quality improvement actions (and CNQ reductions).
Generally, CNQ are classified as:
The CNQ method, associated with a valid "Lean Kaizen" style of approach to improvement, brings the desired results: after an initial increase (consequence of initial efforts and investments), CNQ start their descent, parallel to the reduction of quality non-conformities.
The target is extremely simple: zero quality defects and minimal CNQ.
The overall "bottom-up" approach to quality improvement is structured "Kaizen" style. The approach is identical to the Performance Improvement one. Many tools are identical, some are slightly different and quality-improvement specific. (more »)