Economics of quality/grade

publication date 23.04.2012

Tree diagram showing enhanced economics of quality as per ISO 10014

The economics of quality is a methodology designed to have organizations enhance the customer satisfaction while cutting the costs at the same time. The methodology is supported by the ISO/TR 10014 international standard: Quality management guideline. It guides the management to achieve their entrepreneurial intent while they continously increase the productivity. 

The economics-of-quality methodology is focused on finding the most adequate way to control the costs while working on the fulfillment of the company´s entrepreneurial intent. It lays great stress on :  

  • satisfaction - loyalty of the customer
  • trust in the company
  • reputation of the product 
  • company image

It extends the basic quality management system with the economic objectives. It follows the short-term objectives and the long-terms ones, while continuously evaluating how they are being fulfilled.  

The methodology components include:  

  • performance of the costs analysis
  • costs of compliance and non-compliance
  • defining benefits to the customer  
  • factors leading to satisfaction, pleasure
  • critical financial impacts
  • opportunites identified 
  • management review
  • strong orientation towards performance 
  • costs monitoring
  • an so on.

 

 

Comments on the article

Specialization

Advisor ideas

„Only those who live it can move it forward.“ more >>

Jiří Střelec Jiří Střelec

The best ideas cross our minds when we are really preoccupied with a particular matter, gathering information, making connections, proposing solutions. In sum, when we deploy all of our capabilities to process the information available. Not just a single day, but longer. When we live the given matter today, tomorrow or even the following week or year. You would be amazed how many possibilities would suddenly emerge. If, while writing the project down, your mind is concerned about the coming sports weekend, the project cannot be brilliant but only formal.