About total cost of quality
Where it comes from
Total cost of quality (TCoQ) puts a money value on quality: what you spend to get it right, and what you lose when it goes wrong. Armand Feigenbaum described these quality costs in a 1956 Harvard Business Review article, and they have been a standard quality management tool ever since.
The four buckets
The costs fall into four buckets. Prevention (training, quality planning, process control) and Appraisal (inspection, testing, audits) are the cost of good quality: money spent on purpose. Internal failure (scrap, rework, downgrades found in the plant) and External failure (complaints, returns, warranty claims, recalls) are the cost of poor quality: money lost.
The central idea
Investing in prevention lowers both failure and appraisal costs, while adding inspection alone keeps both high. Failures that reach the customer tend to cost the most, because on top of the repair they bring claims, extra logistics and lost trust.
How this app calculates it
In this app every AlisQI process (set) belongs to a bucket. Its cost is the number of records times the price per record you set in master data, plus the cost fields recorded on those records, all in the tenant currency. The diagnose icon beside each figure and chart explains that metric and reads what it shows.
What good looks like
A healthy profile spends a growing part of quality money on prevention and a shrinking part on failure, while the total comes down over time. Failure found by customers is rare, and appraisal is no larger than the process needs.