The cost of quality
How many of you know how much quality is costing you?  How many of the quality managers know how much quality costs? And if they don’t know this, then how can you expect to improve?

You realise of course that it takes 10 times longer to repair an operation than it does to do it right first time.

The way to establish the cost of quality can be established as detailed below, this figure should be constantly calculated and graphed to see where you are going, either better or worse, it is a fact that unless you can “measure” something you can’t manage.

Our imaginary factory has 480 tailors working a 10 hour day with an efficiency of 50% and an absenteeism of 15%, therefore its capacity is 33,15, 000 minutes per month We will assume that the average standard minutes for their garments is 25 minutes per garment, and that there are 12 lines and each has approximately 40 operators and a mid and end line examination point, and the average line produces 425 pieces per day

Fabric examination

Assume an average consumption of 1.5 mtrs per garment, this factory is making 5100 pieces per day, it is therefore receiving 7650 mtrs per day, it will need 3 people to examine this amount @ a wage of Rs 4,500 monthly = Rs 1,62, 000 annually

Cutting room
One Q/C person and 2 people on panel replacement will cost approx the same as the fabric store, a further Rs 1, 62, 000 per year.

Panel replacement cost, we can assume that 1.5% of large panels are replaced, the small panels will be cut from waste so they do not incur a cost, but if the cutting room is cutting 5100 pieces per day and there are 2 major panels per garment then that is equal to 153 panels to be replaced daily. We will assume that some of these panels will be cut from off cuts (Waste pieces) but 30mtrs of usable fabric would be used, therefore 30 mtrs @ R60 = Rs 1800 per day, Rs 46, 800 per month or Rs 5, 61,600 per annum, therefore the cost of quality in this department is Rs 7, 23, 600 annually.

Factory Floor
The mid line examination point is finding 8% repairs and the end line gets a further 8% repairs
And a roving repair rate of 7% (we will assume they check 425 pieces over the two lines) which means they find a further 3.5% repairs.

19.5 % of 425 garments = 82.8 repairs @ 5 mins each divided by 25 mins = 16.6 garments per line per day X 12 = 199 garments per day are lost @ Rs 50 = Rs 9,960 daily or

The line is paying for 2 examiners, one mid line and one end line @ Rs 5000 each = Rs 10, 000
There is one roving Q/C for every 2 lines again at Rs 5000

There are 2 assistant Q/C heads @ Rs 12, 000 and one head of quality at Rs 20,000

Therefore the factory cost of quality on the factory floor is:

BUT
We are also loosing the revenue of Rs 9,960 per day doing repairs instead of normal production, this is equal to Rs 2,58, 960 per month or annually Rs 31, 07, 520

Finishing
We have not so far included the finishing department, our experience is that the repairs in this department come to at least 20% and this does not include Spotting

In summary then, the cost of quality in this establishment is:

This is almost equal to 3 crore per year – is there perhaps something you can do to save money in this area? And please note we have not allocated any overheads to the calculations!

Remember – none of these people contribute to productivity, they are there to correct mistakes!

Zero errors is impossible! But are you doing things the right way?

Just one further point:
Pieceworkers are very self motivated, they earn good money in comparison to the monthly paid staff, and they produce more, but they are undisciplined, their absenteeism and loyalty is poor, and they do not care too much for the quality they produce, is there some way that we can motivate the monthly paid staff to get somewhere near the Piece workers productivity without the lack of discipline and the quality problems their absenteeism causes?

The industry must do much more to curb absenteeism which is a major cause of the quality problems faced, it is impossible to maintain good levels of quality when you have to replace 6 operators daily on the line and expect them to maintain the levels of productivity required to keep the line running smoothly and to maintain the levels of quality required.

Are we working too hard and not thinking enough??

Roger Thomas
Methods Apparel consultancy
9899011174