Cost of quality

Cost of quality (also known by its acronym, COQ, as well as as costs of quality and quality costs; hereinafter, the Costs) is two parts of all the costs incurred to ensure quality. These two parts are:

1. Cost of good quality (also known as costs of conformance), which are money spent to avoid failures or, in other words, to keep produced marketables defect-free. They include prevention and appraisal costs.
2. Cost of poor quality (also known as failure cost, costs of non-conformance, or costs of failure of conformance), which are money spent because of failures or, in other words, of failure of keeping produced marketables defect-free. They include tangible and intangible internal (i.e. before the marketable reaches the customer) and external (i.e. after the marketable reaches the customer) costs.

The PAF paradigm addresses the same concept; PAF is the acronym for prevention, appraisal, failure. Economically, the cost of good quality and cost of poor quality should tend to be about equal.

Definition

According to Managing Quality by Foster (6th edition),

PAF paradigm. Refers to prevention, appraisal, and failure costs of quality.

   Rework. Action taken to bring a defective or nonconforming item into compliance with requirements or specifications.
   Total quality management (TQM). A philosophy of management that is driven by continuous improvement and responsiveness to customer needs and expectations.