A Practical Quality and Cost Approach

Both six sigma and the quality loss function discussed above are useful tools that can be used to achieve an assessment of product quality- in design and manufacturing and relate it to the cost of the product.

For six sigma，the connectivity to cost is that the desired quality target of 3.4 PPM is required by customers to maintain a high level of growth enjoyed by electronics companies such as Motorola. There is no volume adjustment to the six sigma philosophy, so that the quality level is expected to be the same for mass-produced items such cellular phones and pagers as for low-volume products such as those used by aerospace and the military.

The quality loss function (QLF) can be used as comparative estimate of the loss to the product incurred because of its process average shift versus target or its variability. It can also be used to measure the trade-off of quality between the factory and the customer, as shown in the example above (Section 6.2.2). The cost of a potential defect at the customer is estimated by a monetary value of the expect level of customer dissatisfaction with that defect. The strategy is to allow for a shipping tolerance at the factory narrower than the advertised specifications. ’

One of the obvious difficulties of the QLP strategy is the monetary estimate of customer dissatisfaction. It is larger that the cost of repairing or replacing a defect at the customer, since it includes the cost of removing the defective unit as well the loss of the use of the product and customer dissatisfaction.

A practical quality and cost approach is to use six sigma and its associated tools to calculate the potential number of defects in design and manufacturing. The result will be added to a cost model as follows;

• The quality level will be used to estimate the number of defects to be found in the product based on its current configuration.

• The defective parts will be replaced and the replacement cost added to the manufacturing operation cost.

• The defects generated will have to be removed through testing and inspection, and an estimate of the removal cost will be added to the model depending on the type of test performed.

• The model can be used to monitor the cost trade-offs in the selection of alternate design methodologies, materials, and manufacturing processes, as well as different test methodologies.