A product that meets or exceeds its design specifications and is free of defects that mar its appearance or degrade its performance is said to have high quality of conformance. quality cost refers to all of the costs that are incurred to prevent defects or that result from defects in products Four types of quality cost 1. Prevention costs support activities whose purpose is to reduce the number of defects. Companies employ many techniques to prevent defects for example statistical process control, quality engineering, training, and a variety of tools from total quality management (TQM). 2. Appraisal costs, which are sometimes called inspection costs, are incurred to identify defective products before the products are shipped to customers 3. Internal failure costs result from identification of defects before they are shipped to customers. These costs include scrap, rejected products, reworking of defective units, and downtime caused by quality problem. 4. When a defective product is delivered to customer, external failure cost is the result.External failure costs include warranty, repairs and replacements, product recalls, liability arising from legal actions against a company, and lost sales arising from a reputation for poor quality. Such costs can decimate profits
Quality costs are the costs associated with preventing, finding, and correcting defective work. These costs are huge, running at 20% - 40% of sales. 3 Many of these costs can be significantly reduced or completely avoided. One of the key functions of a Quality Engineer is the reduction of the total cost of quality associated with a product. Here are six useful definitions, as applied to software products. Figure 1 gives examples of the types of cost. Most of Figure 1’s examples are (hopefully) self-explanatory, but I’ll provide some additional notes on a few of the costs: 4 • Prevention Costs: Costs of activities that are specifically designed to prevent poor quality. Examples of “poor quality” include coding errors, design errors, mistakes in the user manuals, as well as badly documented or unmaintainably complex code. Note that most of the prevention costs don’t fit within the Testing Group’s budget. This money is spent by the programming, design, and marketing staffs. • Appraisal Costs: Costs of activities designed to find quality problems, such as code inspections and any type of testing. Design reviews are part prevention and part appraisal. To the degree that you’re looking for errors in the proposed design itself when you do the review, you’re doing an appraisal. To the degree that you are looking for ways to strengthen the design, you are doing prevention. • Failure Costs: Costs that result from poor quality, such as the cost of fixing bugs and the cost of dealing with customer complaints. • Internal Failure Costs: Failure costs that arise before your company supplies its product to the customer. These costs go beyond the obvious costs of finding and fixing bugs. Many of the internal failure costs are borne by groups outside of Product Development.
Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy.
NYSE LISTED COMPANIES 1. Cablevision Systems Corporation (NYSE: CVC) is an American cable television company with systems serving areas surrounding New York City. It is the 8th largest cable provider in the USA, with most customers residing in New York, New Jersey, Connecticut, and parts of Pennsylvania. Cablevision also serves approximately 300,000 customers in Colorado,Montana, Utah, and Wyoming under the Optimum West brand. Cablevision also offers high-speed Internet connections (Optimum Online), as well as digital cable (iO), and VoIP (Optimum Voice) phone service (the 8th largest telephone provider in the U.S.) through its Optimum brand name. Cablevision was founded by Charles Dolan in 1973. In the mid-1960s, Dolan had already built a cable system called Sterling Manhattan Cable in the borough of Manhattan and launched Home Box Office (HBO). He ended up selling both the cable system and HBO to Time Life Inc. With the money he gained from the sale, he started a new cable system in suburban Long Island forming Cablevision. Cablevision quickly expanded and built system throughout the New York metro area expanding into New Jersey, Westchester County, Connecticut, and the other boroughs of New York City. In the 1980s, Cablevision also expanded into the Chicago, Boston, and Cleveland areas. By the mid1990s Cablevision would offer service to 2.9 million subscribers in 19 states. Through a series of transactions in the late 1990s, Cablevision decided to consolidate their cable systems into three core areas: New York, Cleveland, and Boston. Despite reducing the number of areas served they were able to bring the number of subscribers to 3.5 million through these transactions. One major transaction made at this time was with Tele-Communications Inc. (TCI). Cablevision gained 10 New York area cable systems from TCI and in exchange TCI gained 33% ownership in the company. In 1999, AT&T took over TCI thus giving them the one-third ownership in Cablevision. In 2000, Cablevision sold-off its remaining systems outside of the New York area in Boston, Cleveland, and Kalamazoo, Michigan to Media One, Adelphia, and Charter Communications respectively. AT&T sold its share of Cablevision in 2001. On June 13, 2010, Cablevision announced that it would acquire Bresnan Communications for $1.37 billion. Bresnan provides service to about 308,000 cable subscribers inColorado, Montana, Utah, and Wyoming. This is the first time in a decade that Cablevision has owned systems outside of the New York area (although Bresnan, like Cablevision, had its headquarters in the New York City suburbs). In May 2011, Cablevision rebranded the Bresnan systems as Optimum West. 2.Johnson & Johnson (NYSE: JNJ) is an American multinational medical devices, pharmaceutical and consumer packaged goods manufacturer founded in 1886. Its common stock is a component of the Dow Jones Industrial Average and the company is listed among the Fortune 500. Johnson & Johnson consistently ranks at the top of Harris Interactive's National Corporate Reputation Survey, ranking as the world's most respected company by Barron's Magazine, and was the first corporation awarded the Benjamin Franklin Award for Public Diplomacy by the U.S. State Department for its funding of international education programs. A suit brought by the United
States Department of Justice in 2010, however, alleges that, from 1999 to 2004, the company illegally marketed drugs includingantipsychotics to Omnicare, a pharmacy that dispenses the drugs in nursing homes. Johnson & Johnson responded that the payments were lawful and appropriate. The corporation's headquarters is located in New Brunswick, New Jersey, United States with the consumer division being located in Skillman, New Jersey. The corporation includes some 250 subsidiary companies with operations in over 57 countries and products sold in over 175 countries. Johnson & Johnson had worldwide pharmaceutical sales of $65 billion for the calendar year of 2011. Johnson & Johnson's brands include numerous household names of medications and first aid supplies. Among its well-knownconsumer products are the Band-Aid Brand line of bandages, Tylenol medications, Johnson's baby products, Neutrogena skin and beauty products, Clean & Clear facial wash and Acuvue contact lenses. In 2012, Johnson & Johnson announced that they will start to fund the therapeutic device company Clarimedix Inc. to support "proof of concept" study.
Inspired by a speech by antiseptic advocate Joseph Lister, Robert Wood Johnson, joined brothers James Wood Johnson and Edward Mead Johnson to create a line of ready-to-use surgical dressings in 1885. The company produced its first products in 1886 and incorporated in 1887. Robert Wood Johnson served as the first president of the company. He worked to improve sanitation practices in the nineteenth century, and lent his name to a hospital in New Brunswick, New Jersey. Upon his death in 1910, he was succeeded in the presidency by his brother James Wood Johnson until 1932, and then by his son, Robert Wood Johnson II. RWJ's granddaughter, Mary Lea Johnson Richards, was the first baby to appear on a Johnson & Johnson baby powder label. His great-grandson, Jamie Johnson, made a documentary called Born Rich about the experience of growing up as the heir to one of the world's greatest fortunes.