Modelling the Cost of Poor Quality in a Five-State Part Manufacturing Operation: A Case Study

• Published in: The Journal of the Operational Research Society Vol. 49; no. 12; pp. 1249 - 1253
• Main Authors: Feiring, B. R., Sasfri, T. C. P., V. M. Rao Tummala, Mak, R. W.
• Format: Journal Article
• Language: English
• Published: Basingstoke Macmillan Press 01.12.1998; Palgrave; Taylor & Francis Ltd
• Subjects: Applied sciences; Capital costs; Case studies; Case-Oriented Papers; Cost estimates; Cost estimation models; Customer services; Exact sciences and technology; Inspections; Manufacturing; Marketing strategies; Markov analysis; Markov chains; Negative externalities; Operational research and scientific management; Operational research. Management science; Operations research; Paper and paperboard manufacturing; Paper, paperboard, non wovens; Polymer industry, paints, wood; Production costs; Quality control; Reliability theory. Replacement problems; Shipping costs; Studies; Total costs; Value appraisal; Wood. Paper. Non wovens; Markov chain; Prevention; Quality; Inspection; Cost analysis; Failures; Paper industry
• ISSN: 0160-5682; 1476-9360; 0160-5682
• DOI: 10.1038/sj.jors.2600646

The quality history of individual parts from a critical operation can be modeled by a five-state Markov chain involving factory rework operation, customer inspection and field test, parts scrapped, parts defective but used-as-is by concession or re-graded for alternative applications, and defect-free parts satisfying customer requirements. We estimate total failure cost by a five-state Markov chain model and present a case study to demonstrate relationship of the total failure cost to appraisal and prevention costs.