Fundamentals of Cost of Poor Reliability

I define a reliability failure as something that costs your organization money. It might be a warranty expense or a lost customer. A failure may also create customer expenses, too. Let’s talk about the range of un-reliability costs and their impacts.

Consider the impact of a product failure. What are the expenses to you, your organization, your customer, and society? Consider which costs of poor reliability your organization considers and which matter.

Like the Taguchi Loss Function or the cost of poor quality, the cost of poor reliability is far larger than a warranty expense. Yet, many organizations do not consider nor quantify the impact on their customers and society. Sure, some industries do, yet does yours?

Let’s discuss the different types of costs of poor quaintly and how you can estimate these costs. Also let’s discuss how you can use this information to inform design, supply chain, and manufacturing decisions.

The ability to make a good decision in part hinges on having the appropriate information. The cost of poor reliability should be part of your organization’s decision. From component selection to strategic positioning of a product line, reliability performance and the impact of failures matter.

Understanding this concept and being able to estimate and communicate the cost of poor reliability you will improve the decision making across your organization concerning product reliability performance.

This Accendo Reliability webinar originally broadcast on 9 Jan 2018.

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