Quality Costs Concept and Measurement –Does a Reaffirmation in a New Direction Needed?

Abstract

This study primarily aims at presenting a realistic picture of the utilitarian nature of quality costs in companies around the world. This has led to researching the quality costs applications levels, the percentage share of the total quality costs, the percentage share measuring the quality costs categories, as well as the measured percentage shares of the quality costs in the companies. The analytical research methodology relies on an integrated chronological, comparative, logical and systematic analysis of scientific literature, complemented by inductive and deductive methods. The research results confirm the need to raise the awareness for, determination, and commitment to a broader application of the quality costs concept through an understanding and integration of the new societal values of contemporary operations, whereby the understanding of the application of the quality costs concept will deepen and the quality costs concept itself will shift from the margins of a purely theoretical concept. We expect that the contemporary ambitious concepts such as Sustainability, Industry 4.0, Quality 4.0, Business Process Reengineering, Circular economy -Remanufacturing, Innovation 5.0 will contribute to the development a higher level of quality maturity which, in turn, will make the application of quality costs more attractive. In particular, as this will reflect on the redesigning and redefining the quality costs' structure to include new modernized elements of quality costs, and the quality costs concept will be reaffirmed in a new direction and will become recursive.

Visualization of the Process of Tracking Quality Using Quality Costs: An Empirical Study

“…According to Velkoska & Tomov [22] quality costs should not be underestimated, that is corroborated by the fact that they contribute significantly to the total product creation costs that can reach up to 40%, or 38% of the company sales value or 33% of the value of the sales contracts. The same study presented an overview of published research studies about the extent to which companies apply quality costs, which quality costs categories do usually measure, as well as the quality costs measured values.…”

Understanding and application of quality costs in automotive manufacturing companies in North Macedonia: empirical study

“…The empirical studies of Ayach et al (2019), Prickett and Rapley (2001), Rabfeld et al (2015) and Satanov a et al (2015) showed that most of the companies do monitor internal and external failure costs, while the study of Biadacz (2021) showed that companies monitor appraisal costs. A more detailed analysis related to this issue, as well as the measured values of the quality costs categories can be found in the study of Velkoska and Tomov (2021).…”