There are two separate components within Cost of Quality (COQ) and you must have a complete understanding of both of them for your PMP Exam. One is the Cost of Nonconformance, which is the money (and time) that will be spent due to the failure of a deliverable from your project. The other is the Cost of Conformance. This is the figure that is determined to be necessary to avoid those failures in the first place.
There are two categories within the Cost of Conformance. The prevention costs are those associated with building a quality product or service so that any errors are within the range that is considered acceptable. These usually include the elements of training and equipment. Also included in this category is the time and effort required to fully document processes and to do things the right way.
The other category within the Cost of Conformance is the appraisal costs. These are the costs associated with determining the level of quality to ensure it meets the required standards. Appraisal costs include things like inspections and various types of testing that are then evaluated to ensure the quality expectations are being met.
In our next tip, we’ll take a closer look at the Cost of Nonconformance