Cost-of-Quality: COQ is a relative term!

Components of the Cost-of-Quality in Kaizen parlance are as follows.

1/ Costs of external-failures incurred due to failures at customer's end.

2/ Costs of internal-failures incurred in order to handle failures at supplier's end.

3/ Costs of appraisal incurred in order to inspect/audit the adequacy and compliance of quality and quantity of work, and the workmanship as well, as per standards/procedures.

4/ Costs of prevention incurred in order to undertake improvement or failure-prevention activities (as preventative/proactive measures) & corresponding education/training for the same.

First two components are the 'cost-of-poor-quality' (CoPQ) that are incurred after failures. 

Last two components are the 'cost-of-good-quality' (CoGQ) or you can say 'investment' required to prevent a failures in the first place.

The components, rather it's terminology, is relative and hence the  term Cost-of-Quality itself is relative! Use of the components may depend upon the context of the situation.

Is the statement: "If the customer needs to administer incoming inspection on his inputs received from the supplier then that's typically the 'cost of appraisal'!", made by a participant in one of my sessions, 'true' or 'false', for instance?

The statement is 'false'!

It's actually the 'cost of prevention' for the customer. Because she wants to prevent defective inputs from going into the next process. Engaging into inspection activities on the customer's own processes or processing activities, although it's a NVA (non-value-activity or waste) however, is the 'cost of appraisal' for the customer in order to prevent the 'cost of internal failure' in the customer's processes.

Whereas the incoming inspection on his inputs may be is the 'cost of external failure' for the supplier. This is particularly so if the customer engages into 'inspection', a NVA (non-value-activity) 'forced' on to her by herself, because of lack of trust (past dissatisfaction) in the supplier's quality and hence in the supplier's brand image.

Also read a few relevant blogposts hereunder:

Do You Force Customers To Quit
In-a-problem ? No-problem! Dwell-a-while!
Customer or Custo-Mer ?  
Experienced A Delightful Payment ! 
An Experience of Heart-and-Soul 
Do you keep curing your brand ?  
A customer gets what s/he deserves: Shoddy Quality!  
Listen to iceberg of VOC to acquire customers 
Less With More And More Gets Sore 
Should one care for value ?  
Can-changing-thoughts-change-a-nation
Ridiculous Poison-culture versus Maverick Kaizen-culture 
Tolerate Once, Twice, Thrice?  
The Business Of Businesses 
That's how some business partnerships work 
Taken-For-Granted ? You Deserve It !! 
Strategise To Achieve Targets Daily 
Does recognition really matter 
That's How Morons Work
Simplicity Of Theory Of Relativity

Appraisal or Prevention! What's better?

In-process inspection inside a company is typically a 'cost of appraisal' for the company. 

Is the same true for a supplier, for her 'visit to customer for in-process inspection while installing the supplies' at customer's end as a part of the supplier's process!?

It's True, the said installation being a part of the process of the supplier company. 

It's, however, a 'cost of external failure' for the supplier if installation is customer's responsibility and she finds a defect/error in supplies while doing so. Otherwise, it's the 'cost of prevention' for the customer. 

In either of the cases, be it appraisal or prevention, it is a COGQ (cost of good quality) anyway as a part of the COQ (cost of quality)!

One may have to strike a balance though, while deciding upon spending on the latter, meaning on the visit to customer as a part of the process itself, especially in case of high-impact high-value industrial products. 

In any case, the COGQ in general and the other 'costs of prevention' in-house, in particular, may prove to be most beneficial and highly profitable at that.

Why not try validating this statement by calculating the components of Cost of  Quality, for a failed item that reached your customers in past!

Calculating the Cost of Quality (both the COPQ & COGQ), classifying the corresponding components as Tangible (Visible) Costs & Hidden Costs, and comparing them might help.

Also read a few relevant blogposts hereunder:

Do You Force Customers To Quit
In-a-problem ? No-problem! Dwell-a-while!
Customer or Custo-Mer ?  
Experienced A Delightful Payment ! 
An Experience of Heart-and-Soul 
Do you keep curing your brand ?  
A customer gets what s/he deserves: Shoddy Quality!  
Listen to iceberg of VOC to acquire customers 
Less With More And More Gets Sore 
Should one care for value ?  
Can-changing-thoughts-change-a-nation
Ridiculous Poison-culture versus Maverick Kaizen-culture 
Tolerate Once, Twice, Thrice?  
The Business Of Businesses 
That's how some business partnerships work 
Taken-For-Granted ? You Deserve It !! 
Strategise To Achieve Targets Daily 
Does recognition really matter 
That's How Morons Work
Simplicity Of Theory Of Relativity

Invisible Tension

"You have to pay penalty: Rupees Two Thousand.

Why Ma'am?

Because you didn't 'declare' that you had held a passport as a child.

Madam it's inadvertent. During last visit the other 'window' advised to make fresh application under 'reissue' category instead of 'renewal'.

Then go to that window", shouted the 'cashier' (window).

"Fine. I don't have cash right now. Do you have facility to pay on-line?

Don't waste my time...". The lady reacted with an angry sermon. She kept me waiting endlessly. At the closing hours she put some remarks on the application asking to come back on Monday.

Questions that remained unanswered were:

Has she put some adverse remarks on the application?
Are they going to accept the penalty in cash on Monday?
If they do, then what are the next steps?
How many days it'll take to get the passport?
If they don't, then what? And so on.

My son returned with these thoughts that kept bothering him until Monday.

In many situations, one gets preoccupied with such worrying thoughts primarily because of lack of visibility of "what next?"

Someone borrows money but doesn't observe commitment to repay. Nor does he bother to give visibility to when he'll repay. A case of shattering trust.

School authorities don't give visibility for admission process and deadlines and so on.

A standard advice under such circumstances is not to get preoccupied with worrying thoughts. But it's easier said than done.

Isn't there some responsibility (on us as suppliers) to our customers?

Can't we bring in visibility to our role in meeting expectations of the customer and a timeline to do so?

Or is it a strategy by design to give the customers sleepless nights by forcing her to guess "what next?"

If 'Yes', then for a criminal it might be fine. But otherwise it's a criminal behavior.

Experienced A Delightful Payment !

I was working for this company for the first time.

As usual I sent my diagnostic questionnaire: The tool that helps me in weeding out conn-enquiries. Conn-enquiries are the ones that call for the sake of calling followed by a call to visit them only to have a cup of tea.

Such conn-companies don't realise that primary raw 'material' for offering services is time. Material for product offering can be kept in inventory. Time can't be inventoried: Once gone, is gone for ever. That's why even a TV mechanic or a water-filter mechanic charges visit fees.

So if a company doesn't help you in diagnostics you are likely to end up being a 'pig'. 'Three-Pigs' was the name of my first company where I was one of the three with a mission to scavenge in industries.

If the company answers diagnostic queries, it's likely to be serious and your time is likely to go to the needy. Moreover your time gets saved. Because many a time companies call you to ask the same questions they could have been answered on phone or by mail. Why waste fuel, time and energy kind of questions hardly bother them.

The company I am writing about responded the next day.

Asked for the path-ahead for lean journey alongwith my quotation.

My office sent proforma invoice the next day.

The company sent me their 'supplier registration form' by return with a request to "comply by return". It was followed by a reminder mail saying "Waiting for your immediate reply."

The form was one of the most complete ones that included all the information such as whether my office was a brick or a RCC structure. My office sent back the form promptly duly filled in.

Same evening I got a call saying "Your 'supplier registration' is complete. Please ensure to get bill alongwith you. End of your counseling you will get cheque in your hand."  Communication was crisp and clear.

Deliciously delightful experience! First of it's kind for me!

May be the company had timebound performance criteria for their delivery processes. But I had seen many companies in spite of having such criteria failing to pay even after a couple of years.

A typical Indian company paid me half the amount overdue to me after half century of telephone calls and five times more emails. It wrote-off half, paid me half after two years. That means the money was depreciated by half due to inflation. I have not considered cost of follow-ups though which is actually a part of any Indian's routine.

I used to call my customer-friend every time Sachin Tendulkar used to hit half-century expecting the Sachin-fan's mood to be good, but in vain.

Some such company's performance criteria is to keep more amount in credit than debit. Their unwritten rule is to delay payment multiple times the agreed payment time. Former should overrule the latter or vice versa whichever worked out favorable to them.

This 'taking others for granted' is a typical behavior in high mistrust societies. Hopefully my delightful experience is not a mystery. Actually much more than the performance criteria, it's the culture: the soft dimension that makes the difference.

The delight company happens to be an Indian subsidiary of a Japanese company perhaps richer in the soft dimension: The Kaizen Culture!

Also read a few relevant blogposts hereunder:

WOW Work-Culture: By Telling or Selling 

Make It Simpler, Rest Will Follow

How To Make A Difference 

An Experience of Heart-and-Soul

Take your career in fast lane!

Succession-Plans In Fast Lane!  

Nauseous Communication Gaps 

Do You Cleanup-After-Crisis 

Will It Work Here?  

You seem Reasonable if you appear Un-reasonable 

Can-changing-thoughts-change-a-nation

Ridiculous Poison-culture versus Maverick Kaizen-culture 

Tolerate Once, Twice, Thrice? 

That's how some business partnerships work 

Taken-For-Granted ? You Deserve It !! 

Customer or Custo-Mer?  

In a Problem?: No Problem ! Dwell A While !! 

Do You Ask Right Questions?  

An Experience of Heart-and-Soul

Bapu's smile!

Courteously asking for 'tea or coffee'!

Issue of token for work within a minute of entry at security gate!

Prabhakar's speedy response to take car for quick touch-up!

Warm get-up of the cool waiting room!

Job done in a couple of hours although (the paint touch-up was) with a little less of finesse. Generally a dealer would take a work-shift including a bit of waiting due to Sunday rush. Of course it was a planned visit so scheduling the job was easy for them.

Being a Kaizen student, I expressed desire to take a study tour. It was quickly acceded to.

Customer does expect such activities to be performed of course with 'aesthetic-smile' that competition has 'forced' upon suppliers in auto sector in particular.

He 'pays' for the 'standards' alongwith for the Technology, Tools, Materials, etc. anyway that all paraphernalia  management does employ from 'outside' i. e. from the material world. They even don't forget to put a 'smiley' foot-mat that says 'thank you'.

But what one can't forcibly employ is the evidence of heart-and-soul, the 'inside',  while performing above kind of trivial looking but relevant activities as duty (that predominantly need human interventions).

If one passionately enjoys it as a play it gives pleasure to self and hence for others. Inevitably it adds value to self that no one can snatch away from. The 'player' looks beautiful then.

For that 'beauty' to happen the leaders at workplace must enjoy the work themselves. They must enjoy their own work of - leadership by demonstration, - pouring heart-and-soul in playing their own role, - recognizing those colleagues and subordinates who do so,  - employing 'telling' tactics if 'selling' fails to those who don't do so so that they don't spoil others who do.

Hope such Heart-and-Soulful experience doesn't fall back to Heat (the customer First) and then Cool her!

With that consistency then not only will the 'player' look beautiful but also s/he will make the workplace look beautiful!!

Also read a few relevant blogposts hereunder:

How To Make A Difference

WOW Work-Culture: By Telling or Selling

Experienced A Delightful Payment !

Take your career in fast lane!

Succession-Plans In Fast Lane!  

Suggestions On-Sale, None-To-Buy

Can-changing-thoughts-change-a-nation

Ridiculous Poison-culture versus Maverick Kaizen-culture

Tolerate Once, Twice, Thrice?

Some Moron ! Some Great !!!

That's How Morons Work

Aesthetics Spills-Over Function, Want Spills-Over Need (Part-1)

Aesthetics Spills-Over Function, Want Spills-Over Need (Part-2)

A Ride To Hell

Will It Work Here?

You seem Reasonable if you appear Un-reasonable

Smart-Moron Who Breaks Your Glass 

Suggestions On-Sale, None-To-Buy

Prevention: The Best Cure! ... Is it really so?

In-big-problem? Wear-hats-to-solve-it!

Discrimination Cremated! But How Long?

Can you see the traffic-jam in 'Before' picture. 

The change seen in 'After' picture is captured on next day. It so far has lasted for a day at least until writing of this post. Authorities took a couple of vigilance rounds after twilight also. 'Being vigilant on what one wants' was one of the success factors. 

Although it might be too early to rejoice this it didn't happen overnight.

It took more than seven years to see such a desired picture. Public had been struggling to get a solution since then. Authorities with all their might were unable to control a few heavy vehicles parked there illegally, causing trouble to traffic as well as to the community. One may read more details in my blogposts titled "Discrimination-is-Cremation of Law-&-Order (Part-1) and (Part-2) that prompted title of this post. 

But how long will this last? 

Just about I was penning this down see what the other picture that I took at the other end of the road about 30-yards away says.

I tweeted the abnormality as "Corporate-Social-IrResponsibility@HajuriRoad Thane. India Shines! Effluent disposal on road. Road blocked."

Sanjivani (my better half) dials Police-Control-Room #100. Alerts our society's security guards. A few alert citizens don't allow 'them' to take it for granted. The 'irresponsibles' RETREAT. INDIA WINS!!!

All within just about half an hour.

Yes.. ss.. ss! Social media does work sometimes!

The point is how and why everyone just takes-it-for-granted.

So with such an attitude of various stakeholders it's foolish to conclude that changes for the better such as in first picture will sustain on their own.

What's the learning?

Change can happen overnight if people-in-power take up causes of common-interest seriously and with a sense-of-urgency at that.

'They' ('suppliers' of the trouble as well as service-providers) do and will test patience of people-NOT-in-power. So people-NOT-in-power must persevere and "keep-knocking" their-doors even by guerrilla tactics if required.  

It's unfortunate but true that citizens in high-mistrust, inefficient and in-effective societies have to spend more than half their waking hours in non-value activities such as visiting and revisiting government authorities' and supplier's workplaces for reworks and follow-ups.

Be vigilant otherwise "But-How-Long?" will keep you haunting.

Use technology as a powerful enabler. That's one way to speed up the snails.

Faster you rejoice faster you will repent. Let equanimity prevail.

Also read a few relevant blogposts hereunder:

WOW Work-Culture: By Telling or Selling

Discrimination-is-Cremation of Law-&-Order (Part-1) 

Discrimination-is-Cremation of Law-&-Order (Part-2) 

Make It Simpler, Rest Will Follow

How To Make A Difference

A Ride To Hell

Tolerate Once, Twice, Thrice?

Do you exercise your choice meaningfully

Taken-For-Granted? You deserve it! 

Will It Work Here? 

Technology in-place, security dis-placed

India-shining

Do you know a Best-Career-Plan

Some Moron ! Some Great !!!

That's How Morons Work

You seem Reasonable if you appear Un-reasonable

Customer or Custo-Mer? 

Ridiculous Poison-culture versus Maverick Kaizen-culture

Smart-Moron Who Breaks Your Glass 

WOW Work-Culture: By Telling or Selling

Raam or Krishna-Shyam: Tell me Hey Raam!

Success-or-failure! What-do-you-like?
 

How Many Times Do You Wash Hands

Our regular cook was to stay absent for a few days. We asked for an alternative arrangement. Usually they won't make it. You have to ask for it. 

The person who substituted her straight went to kitchen (shop)floor to fetch flour. She dug into the container without washing her hands. After a while she began beating the dough.

When I asked her 'why didn't she wash her hands' her response was that she had washed hands at home.

Funny!

One does encounter such behavior at automated high-technology workplaces as well. Other day I saw a bearer with a nice hair-cap worn to prevent hair falling in food. Although he had a glove worn over his right hand he was serving roti (Indian bread made on a touch-free automatic machine) by the bare left-hand. Funny isn't it!

Back home I had to tell the maid that her hands might have encountered so many undesired touch-points on way to my home, her workplace.

Typical Touch-Points

Fetch purse or bag while going to work
Wear shoes (one touch-point less for the good if socks aren't worn)
Hold handle of the door in order to open it
Hold handle of the bus to board it
Exchange cash for ticket
Hold the handle of the lift (at workplace)
Pick up dust bin left outside the owner's home overnight in order to bring it inside

Unbuckle her shoes

One may consider so many such kind of touch-points like combing hair, picking teeth, shaking hands with friends-and-foes on the way, and many more creative ones that people usually engage into.

After all such diversely possible touch-points, she had taken a deep dive into the flour merrily beating it's dough inside-out: All this without washing hands!

One might suffer a blackout at slightest of imagination of even a single touch-point:

On blowing their running noses, do you know how many people  touch all those handles (of buses, of doors, of toilet doors, etc.) how many times in a day?

Do you know that the currency that you exchange might have landed in your hands after having passed hands of so many beggars?

A single search on internet can confirm that one of the most dirty touch-points housing most dangerous bacteria are the various knobs and handles that one handles at public places.

After so many such dangerous touch-points, how about eating food without washing hands because they were "already washed while leaving the workplace or leaving home for work"?

One may allow such funny practices if on a massive immunization programme or is on a mission to be a guinea-pig for all kind of germs on the planet. Some more germs might not make much of a difference having swallowed some inadvertently already.

But reality is different. Not only does one take a complete wash on entering home but also takes a well-rubbed hand-wash just before eating. 

Then why tolerate double-standards like that of the maid, behaving exactly the reverse on leaving home for work?

Surely it's the result of lack of attitude that's reflected in unclean behavior. One reason might be lack of education. Prior to that it may be lack of adequate standards and procedures (SOP¹) on cleanliness: unique-standards or single-standards if you may like to call. Most important reason is the lack of commitment by decision makers to train and motivate and if required take tough and unpleasant decisions about the concerned. 

Else corresponding consequences are well-deserved if one doesn't work towards it. 

Some do appear unreasonable mavericks at times on self as well as on others to change such bad habits! 

It's not out of place here to remember those few who refrain from shaking hands. Instead they greet by putting both hands together: The well-thought-out Indian practice of Namaskar! 

Footnotes: 

1. SOP: Standard Operating Procedures such as GMP (Good Manufacturing Practices) or Five-S practices in industry. 

Also read a few relevant blogposts hereunder:

How To Make A Difference

WOW Work-Culture: By Telling or Selling

Some Moron ! Some Great !!!

That's How Morons Work

You seem Reasonable if you appear Un-reasonable

Am I 'Short-sighted' or 'Long-sighted'?  
Beware Of Political-Presentations 
Do You Cleanup-After-Crisis 
Hoarders Of Filthy Hoardings 
Are You Good If Others Are Bad?

Smart-Moron Who Breaks Your Glass 

Suggestions On-Sale, None-To-Buy

In-a-problem? No-problem! Dwell-a-while!

Can-changing-thoughts-change-a-nation

Ridiculous Poison-culture versus Maverick Kaizen-culture

Tolerate Once, Twice, Thrice?

Taken-For-Granted ? You Deserve It !!

Technology in-place, security dis-placed

Listen to the iceberg of VOC to acquire customers

Having traveled over 500-Kilometers in a 'bus-to-hell', I requested the agent to "book my return-journey on a bus-service that follows road-safety norms (especially the overtaking related), doesn't honk horn excessively, nor does it overuse brakes."

There was no other convenient alternative mode. A debt-ridden airliner had stopped operating on that (the Mumbai-Hubli) sector.

The travel agent gave me a funny look as if he was booking a ticket for an alien.

Not his fault because he was used to conventional requests like "timeliness, cleanliness, bus-with-video", etc. But someone like an idiosyncratic like me had to do the nasty job of giving customer-feedback. I usually don't hesitate doing so, sometimes even by making unusual requests such as above although unsure of the cognizance of it. 

I'm optimistic that sometime someone will. I think every customer who isn't, deserves to get a shoddy quality if s/he does!

Anyway, whether a customer complains or not, is it difficult for owners/managers of tourist buses to prevent their bus-drivers from overdoing: honking, speeding-up, braking on-and-oft, etc. kind of bad work habits. Now a days even digital technology is available to do so. Drivers, especially the bus-drivers, are constantly in a mood to kiss other speeding vehicles passing by.

Perhaps only on Indian roads the passengers must be getting reduced to a continuously-rattling grain-in-a-sieve. One has to master the art of Napolean-nap (quick nap on horse that he's famous for) to be able to take one in between a couple of sets of honking and braking in buses in India.

Forget feedback or lodging a complaint, hardly anyone even dares to voice such abnormal driving behavior. Surely s/he won't for the fear of the 'boss'-driver particularly if forced to travel frequently in the same bus.

Some companies do have a mechanism to capture such voice-of-customer (VOC). Because they know that, although sounding like 'idiosyncratic' casual remarks, VOC are just a tip of the iceberg (of complaints not voiced by many others for various reasons).

Some of them are sensible and sensitive enough to take next steps that of digging into the iceberg to take corrective and preventive actions treating such voices as 'complaints', although at times they may not be so.

- But having taken actions, how many look at the resulting improved practices as a competitive advantage! 

- How many build upon them and deploy them horizontally as specifications enhancing their own standards over and above their 'core-offering'! 

- How many communicate them (through their marketing promotion programme) in order to differentiate their services from from others!

Those who do, do score over their competition!

What steps do such forward looking companies take?

1/ They educate their staff that hardly over 4-out-of-100 dissatisfied customers might end up complaining. Rest just quit without-telling even as the so-called satisfied customers continue to 'live' with abnormalities until of course they get alternative-options.

2/ They install various mechanisms such as follows to capture VOC.

- They actually travel like a ghost-customer (known as mystery-shopping practice) in order to learn by observing abnormal as also good practices, if any.

- They train their staff to speak and/or 'actively-listen' to customers just as a mother would do with her tiny tots in order to learn their unspoken-unmet needs over and above their 'crying' wants anyway.

3/ They put Kaizen-improvements in place on relevant VOC observations, abnormal as well as good practices of own as also that from customer's gemba, and unspoken-unmet needs as also wants.

4/ They train and re-train their stakeholders on the above for effective implementation.

Actually specifications such as timeliness, cleanliness, video, etc. are a given 'Must-Quality' norms to enter or at the most to be in business.

Additionally it is the satisfaction of VOC: unspoken-unmet needs as well as wants (that's why it is called as 'Quality-that-Delights' the customer) that has the power - to expand the base of customer as also of the business (Ansoff-Matrix) by not only helping to bring out innovative products/services but also - to pull in additional customers (brand-affinity) while retaining the existing ones on existing products/services (brand-loyalty).

Of course, effectively communicating the resultant differentiations among all its stakeholders is part and parcel of the process.

Very few companies actually administer such a conducive mechanism by-design. Imagine the scope to benefit from it in terms of top-line sales and bottom-line profits if they do.

Also read a few relevant blogposts hereunder: Please do consider leaving a comment or sharing this post.

No Time? Micro-Meditate!  
Functional-Aesthetics
Listen To The Iceberg Beyond Tip

Overworked? Tension? CPU of the mind hung-up? 
Do you exercise your choice meaningfully 
IQ-EQ-or-SQ: What-is-more-important? 
Eternally Happy! 
In-a-problem? No-problem! Dwell-a-while! 
I am afraid ! What do I do !! 
Fearful-Of-Death-of-Birth
Take Habits For A Ride 
Happy-Birthday-to-Youooo
Do You Celebrate Mean-or-Green 
Big-Be Or Bug-Be ! 
Raam or Krishna-Shyam: Tell me Hey Raam! 
Are You Good If Others Are Bad?  
Want Need-Or-Want 
How To Make A Difference 
Love is Care.. Care is Love !  
Deity is in the eyes of the beholder 
Success-or-failure! What-do-you-like?
Ball-Basin-Team Combine !  Maketh The Smile Divine !! 

Can-changing-thoughts-change-a-nation