Professional Documents
Culture Documents
In this article authors analyze the connections between: PLM, extended product and
Quality Management, these three concepts having in fact similar objectives; to
optimise from all points of view, the product, to obtain a better customer
satisfaction, and to reduce the products impact on the society and the entire
environment.
Authors propose a model of identifying and classifying quality costs based on: PAF
(Prevention, Appraisal, Failure) quality costs model, Extended Product Concept, and
PLM stages, in order to meet a company’s needs.
Producer and User view on PLM
Life cycle costing is traditionally understood as the process of economic
analysis to assess the total cost for conception, design and development,
production, installation, operation and support for a useful life, updating
modes and retirement of a product.
In general, this cost refers to any costs that would not occur if within companies all
processes would have perfect quality. All companies’ departments are creating and
are responsible for quality costs . This kind of costs may occur within any process
and activity, form the top management’s area to the production line.
Within empirical studies of companies form mature and developed markets and in
specialised literature average weights of the total cost of quality assurance are:
Prevention costs 3-12%, Evaluation costs 15-32%, Internal failure cost 22-50%,
External failure costs 20%. Also, these researches revealed that the total quality cost
is an approximate 15% of sum of total sales
G.W. Parker defines the main quality costs classes:
◦ Ce = external cost of failures (customer complaints and refusals)
◦ CP= prevention costs (marketing cost, design control, staff tranings, quality plannings,
research on delivery’s performance).
◦ This approach on Quality Cost is known in the specialized literature as the PAF model
(Prevention, Appraisal, Failure)
The specific studies reveals the fact that beside these 4 classes of quality costs
there is another class, Hidden costs, which are almost impossible to identity
form papers or accounting system.
The majority of the studies in this field reveal the fact that in addition to any
model, in order to find data about quality cost, it is necessary to integrate a team
within the company that can provide information about all the activities and
quality costs.
In this context, the authors of this paper propose a model to facilitate data
collecting of costs related to quality as seen in next Table.
This model is based on Product Life Cycle stages, as a technical view for a
common classification of places where quality cost can be generated, intersected
with the Extended Product Concept stages, which represent an economical view
for a classification of commercial activities, where quality cost can occur.
The quality cost proposed in this general model of identifying quality costs are
based on G. Parker’s and J.M. Juran’s research, but they may vary from industry to
industry.
Table 1.Extended Product component intersected with PLM stages for identification and classification of
quality costs as based on the work of G. Parker and J.M. Juran
Next, authors propose a detailed presentation of a cost element afferent to each
intersection, for a better representation of quality costs, basically realizing a
specific cost sheet. This cost sheet contains data about the quality cost, class of
quality cost, the amount of the cost, the department where it occurs and the
principal responsible. Also, it contains an observations section where statistics can
be registered, as well possible causes, and future improvements, as seen in Table
2, intersection A.1
Table 2.
Identification of quality cost will highlight the possible profit lost by an
organization. In this manner, managers can realize the importance of Quality
Management and Cost Management. For organizations, is important to highlight
the quality or non-quality costs, to identify their source and ultimately, to correct
or to eliminate them.
PLM, Quality Management and Marketing are concepts that constantly intersect
and, actually, they have the same objectives, to maximize the added value, to
obtain performance, efficiency, productivity, flexibility, cost savings and
sustainability, recycling and environmental protection.
In highlighting the costs related to quality of the extended product, PLM represent
steps and stages within which these costs usually occur.
The model proposed by the authors is theoretical framework based on the PAF
model, which allows for an easier and better way to indentify quality related costs.
Future research within a company will respond to our concern of validating this
model and prove its practical value.
This paper was supported by the project "Doctoral studies in engineering
sciences for developing the knowledge based society - SIDOC” contract no.
POSDRU/88/1.5/S/60078, project co-funded from European Social Fund
through Sectorial Operational Program Human Resources 2007-2013.