Appraisal Costs as a part of Cost of Quality Program

The Cost of Quality is not only costs of failure whether internal failure cost or external failure cost, but one of the important categories we should to keep in mind when we are calculating the cost of quality is the Appraisal costs.
Appraisal means that assessing something or someone and in our quality language appraisal means the assessment for the product, thus appraisal costs are quality costs that evaluate the quality of product or determine the degree of conformance to quality requirements. So these costs are associated with testing and inspection.

In determining appraisal costs, what is critical is the kind of work done and not done the department name, also note that industries use a variety of terms for appraisal such as checking, balancing, reconciliation, review

Examples of Appraisal Costs: 

1- Purchasing Appraisal Costs

  • Incoming inspection and test: evaluation the quality of purchased product, whether by inspection on receipt, by inspection at the source or by surveillance.
  • Qualification of Supplier: added inspections or audits for periodic qualification.
  • Inspection and test materials and services: Materials and supplies in inspection and test work and services where significant.

2- Operation Appraisal Costs (Manufacturing or service)

  • In-process inspection and test: In-process evaluation of conformance to requirements.
  • Final inspection and test: Evaluation of conformance to requirements for product acceptance.
  • Document review: Examination of paperwork to be sent to customer.
  • Balancing: Examination of various accounts to assure internal consistency.
  • Product quality audits: Performing quality audits on in-process or finished product.
  • Maintaining accuracy of test equipment: Keeping measuring instruments and equipment in calibration.

3- External Appraisal Costs

  • Evaluation of stocks and spare parts: Testing products in field storage or in stock to evaluate the degradation.
  • Field Performance Evaluations: all evaluation efforts planned and conducted at the site for installation and / or delivery of large complex products or conduct of merchandised services.
  • Special product evaluations: life testing, environmental and reliability tests on production units.

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