p:\fcs\oc\00tool\material\graphics\a-f\costqua3.docGenericSampleWorkProducts#3PaperIndustryExampleThismatrixillustratesaCostofQualityAnalysisinthepaperindustry.Notetheveryhighappraisalandinternalfailurecostrelativetopreventivecost.Materialcost(referredtoasMastery)andtherevenueimpactofsellingsecond-gradematerialwereadded,resultinginatotalcostofqualityof$23million.PAPERINDUSTRYCOSTOFQUALITYMATRIXSALARYCOSTS($000S)PLANTTECHSALESACCTGL&TCONTROLLERTOTAL3.06DevelopmentofPBOPs$300$67$10$3773.07ModificationofPBOPs78233$11053.08PBOPVerification3493463.09PBOPDocumentationControlandReproduction18814403.10Phase-InofPBOPs6915843.12ProcessDevelopment/Improvement30717940485743.15SupplierCertificationandAudits58171313.36PredictiveAnalysis16784222014.19PreventativeMaintenance(PM)-DirectLabor735331699371.00PREVENTATIVE$1,713$317$0$0$110$255$2,3953.11InspectionandTestPlanning$24$20$4$30783.23IncomingInspection291226674.09InspectionandTests/ProcessControl1,145261,1714.10MaterialDeviationReview553584.14QualityAssuranceAudits1991216612794.20On-LineMaintenanceInspection27222193132.00APPRAISAL$1,724$73$1$0$92$76$1,9663.19PurchaseOrderChanges/Follow-up$38$24$1$5$6743.37MaintenanceFailureAnalysis177751894.02SetupandChangeover-Start-upTroubleshooting2021212154.06In-PlantExpediting4044.08ProductionProcessIntervention7212047454.11ProductionRework27612774.18MaintenanceEmergencyResponse-DirectLabor92611605851,5824.24ExpediteMaint.Materials,ToolsorEquipment7024331004.25ForcedIdle-MaintenanceLabor1882434314.28Oper.Waiting&IdleTime-SetupandChangeover697764.29Oper.Waiting&IdleTime-WaitingforMaterial96964.30Oper.Waiting&IdleTime-MachineDowntime33173194236.27Safety-IncidentRelated8527321266.52Non-Operations/Non-Maintenance-WaitandIdle109193.00INTERNALFAILURE$3,195$82$0$1$180$901$4,3595.05CustomerComplaints-Delivery$5$0$7$1135.06CustomerComplaints-Quality618711785.07FieldFailureAnalysis100104.00EXTERNALFAILURE$66$8$14$0$12$1$101GRANDTOTAL$6,698$480$15$1$394$1,233$8,821ThisgraphicillustratestheCostofQualitybasedonthePaperIndustryCostofQualityMatrix.CostofQualityQualityActivitiesEffortMasteryCostofQuality$23MMSecondGradeMaterial-11,000Tons/Yr.-$80/TonPriceDifferential$.9MM-Prevention-Appraisal-Failure$8.8MM-Reject-LostProduct-Wood-Chemical-R&E$13.0MMp:\fcs\oc\00tool\material\graphics\a-f\costqua3.doc
