Cost of Conformance refers to the level to which a product or service meets its requirements. It is the sum of all costs incurred by a company in order to achieve the desired quality level for a product, service, or product. All of the attention is directed towards preventing defects or issues with quality before final products or services are delivered to customers. Cost of Conformance can have various costs.
- Training and manpower to support process improvement projects (including overtime and payroll)
- Purchase or implementation of the necessary tools and equipment
- Modifying designs or processes to meet customer needs
It does not include any costs post-production or delivery (to the customer), associated with rectifying mistakes. Costs of non-conformance are separate costs that are not preventative.
Three benefits of COC
1. Conformance is when an organization meets the standards of a standard body.
Conformance ensures that products and services meet the needs of customers and other stakeholders. It also ensures compliance with agreed-upon specifications by the standards body. Conformance can also improve overall quality by preventing organizations from introducing defects to their products and services.
2. Lower costs
Conforming to standards results in lower costs for organizations. They may have to spend less time investigating and resolving potential problems, or they might be able to avoid costly redesigns and rework after a defect has been found. This saves money in the future.
3. Quality improvements
Conformance not only reduces costs but also improves quality by preventing organizations from introducing defects to their products and services. Conforming to relevant standards allows an organization to more easily ensure that its products or services meet the expectations and requirements of its stakeholders.
What is the importance of understanding the costs of conformance?
It is important as it shows how hard an organization works to meet the specifications. Conforming to a specification means that an organization is making a commitment to comply with the specifications. This could mean making changes in the way the organization works, creating new systems, or investing in software or hardware that meets the specifications. Organizations can understand these costs and make informed decisions about when to meet specifications.
When deciding whether to conform to a specification for an organization, it must consider not only the benefits and costs of conforming but also the costs of not conforming and the consequences.
