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Cost of Quality in a Service Industry

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List and describe the various aspects of the cost of quality. Choose a specific service, such as Banking, Restaurant, Retail, Health Care, etc.

Discuss how the cost of quality might be different in some aspects for this service organization compared to a manufacturing organization. Be sure to make a good argument for your position.

Enter your original response to this question. Support your response with evidence from the readings or other resources. It is not necessary to provide formal citations, but you should give the sources of your information.

BACKGROUND: Review these URLs for more information about Lean, the principles of lean and eliminating waste.

The five lean principles as well as some of the historical aspects:

Lean Enterprise Institute. (2009). Principles of Lean. Retrieved from http://www.lean.org/WhatsLean/

This website provides a good overview of Lean (from the UK viewpoint):

Leaning Forward. (2009). The 5 Lean Principles. Retrieved from http://www.leaningforward.co.uk/principles.htm

YouTube video about Lean Mfg:

Gemba Academy. (2009). Introduction to Lean Manufacturing. Retrieved from http://www.youtube.com/watch?v=ZdHGTCXcJQU

Value Stream Mapping and 5S.

YouTube video about Value Stream Mapping (VSM)

Society of Manufacturing Engineers. (2009). Mapping Your Value Stream. Retrieved from http://www.youtube.com/watch?v=K0fWw9QXk60&feature=related

YouTube video about 5S:

Gemba Academy. (2009). 5S Overview. Retrieved from http://www.youtube.com/watch?v=c0Q-xaYior0

How does Lean relate to Six Sigma?

Pyzdek, Thomas. (1999). Six Sigma and Beyond: Six Sigma and Lean Production. Retrieved from http://www.qualitydigest.com/jan00/html/sixsigma0100.html.

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Step 1
The different aspects of cost of quality are that is the amount of money a business loses because its product or service was not done right in the first place (a). An important aspect is that businesses lose money because of poor quality. One aspect of cost of quality is prevention costs. This is the cost incurred to prevent poor quality in products or services. The second aspect is appraisal costs (b). This is the cost incurred for measuring, evaluating or auditing products. The third aspect is failure costs. These are the ...

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