Formula for cost of non-conformance

Good morning all

Does anyone have a set formula for the Cost of non-conformance ?

Thank you in advance

Kevin

Hi Kevin,

Cost of poor quality could be claculated by determining the internal and external faliure , fixed formula would be not logical approach since each factory is considering specific parameters , but cost of poor quality could be calculated through for example: 

1. External poor quality:

A. Customer complaint and penalities paid

B. Losses of customers 

C. Amount recalled or withdrawn

D. late shipments penalities 

2. Internal poor quality;

A. stoppage of line 

B. Hold products 

C. Rework or re-processing of products 

4. Consupmtion of products and raw materials to cover shortage due to destruction of products 

You can make it by Excel sheet and per month or week and then calculations could be figured by data analysis (Histogram for example).

Hope i could help you,  

Greetings Kevin,

Please elaborate, the question is really vague. Add more details. What standard, which process, does the auditor need to revisit for affirmation of the changes due to non-conformances (it also can include a cost) and so on.

Taking a chance here there is no formula for the cost (money-wise), cause it depends on what is the non-conformance. Is it the change in the wording of a document or the need to purchase -let's say- a metal detector or change the service/product of a provider etc etc?? There are so many parameters that can't be put into a set formula.

Only categorization could be something like: No cost (eg change of wording in the written procedures)/ Low cost (eg auditor revisit)/ High cost (eg machinery). Bottom-line each non-conformance is assessed on its own depending on what needs to be done to correct it.

Regards!

There are a lot of factors to consider. You could also include costs for extra labor, shipping (from customer back to your facility), disposal, each product likely has a different cost per unit,