Quality Costs - Failure
Failure costs are further sub-divided into: Internal failure costs and external failure costs.
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Internal costs are incurred when the quality system fails to deliver product that meets the specified requirements. Typical internal failure costs include such activities as:
- Waste
- Scrap
- Rework
- Resources required to dispose of non-conforming materials
These are sometimes referred to as the costs of ‘non-quality’.
External costs are those incurred after the product has been released to the customer, such as:
- Recall costs
- Warranty repair, if applicable
