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Discussion Topic: The cost of Quality

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 Josh
(@orleron)
Posts: 95
Trusted Member Admin
Topic starter
 

This is a phrase you will encounter sometimes. "The Cost of Quality" is a concept.

Let's say you have a product, and you do no QA/QC on it. For a while, you might do fine. The product might really be great, and not fail. Then, inevitably, it happens.... something goes wrong. You get a bad lot that gets sold and winds up hurting people. You then get sued and lose, and have to pay millions of dollars in damages, which of course makes you go out of business.

Your company is dead.

Now go back in time to the beginning of the company, this time with QA/QC in place. Sure, you have to pay for it. You need to hire Quality Engineers at $60k+ each, etc. You need to create documentation. You need to have approval processes in place. You need to inspect product off the line. You need to do a LOT of things, all of which cost money. But guess what? When that bad lot gets made, you catch it before it goes out! No one gets hurt. No one sues you for millions of dollars, and no one puts your company out of business.

Your company gets to live another day.

This is the concept of the Cost of Quality. If you put money into Quality BEFORE bad things happen, you have a chance of averting something awful that will put you out of business because it costs you much MORE to fight the lawsuits than it does to hire the people to prevent them.

Now think about people in the world, whom you will meet, that complain about Quality and how it's a burden. Thoughts?

Spiral Medical Development
www.spiralmeddev.com

 
Posted : 29/10/2016 6:34 am
(@savery115)
Posts: 82
Trusted Member
 

I believe it comes off as a burden because Quality are the people who tend to reject or question every detail of a report or analysis.

You want to get product that moves out the door in a timely matter. Quality Control, most of the time, requires 100% inspection of a lot or doing First Article Inspections on a certain amount of product. These things are time consuming and if you find that product in the lot that gets rejected, chances are the whole lot gets rejected before it gets moved out the door. So to your point, yes you want Quality to catch it before it hurts the company in the long run. Is it necessary? Absolutely. Can Quality processes be improved? YES. And that is where I think the issue lies. Depending on the company processes, trying to convince Quality that there are better ways to improve the Quality Control and Quality Assurance processes is a difficult task. I've found sometimes some of the Quality processes are unnecessary and it would be more effective and robust to just remove this process all together.

In addition, most drivers for a company are within this cycle below:

However, I think its difficult to appease all 3 and usually companies end up sacrificing 1 of the 3 and that tends be quality in some cases.

 
Posted : 01/10/2017 9:43 am
(@amandaally1029)
Posts: 40
Trusted Member
 

I can see how people might think quality is a burden, because of all the testing and extra work that is required to make sure a product is safe. However, I do think it is necessary because like you said, its better to have a quality check in the beginning rather than the product failing and having your company lose millions of dollars. I believe that when it comes to quality assurance and quality control, questions are supposed to be asked if something goes wrong during testing. Its essential to make sure that a product is functioning and designed as promised. It might seem like a burden in the beginning, but in the long run its rewarding, and its one of those things that must be dealt with. OF course, I would have to agree that there should be a simpler process to avoid extra paper work and analysis.

 
Posted : 01/10/2017 1:05 pm
 zbw2
(@zbw2)
Posts: 47
Eminent Member
 

For everyday tasks, "its too much work" is never a good reason not to do a particular task. the same applies to QA/QC systems. while these systems can be quite onerous to maintain, I think most people would rather good quality over expedited delivery or lowered cost. From a business standpoint, especially a startup, low cost and quality are priority, therefore, spending the time and money on the front end is worth the headache and potential multi-million dollar lawsuit or recall.

Samsung SDI is a good example of a company that would have benefited from better QA/QC systems. The recall following the exploding Note 7s caused Samsung to lose 26 billion in market value. after the recall Samsung ran an extensive marketing campaign illustrating the revamp of their QA system to regain public trust in the brand. It was bad enough that the burning phones destroyed users' property and damaged lungs from smoke inhalation.

the stakes are raised when considering FDA regulated medical devices.
Just a few days ago, sept 28,2017, Sorin Group Italia issued a recall on defective Implantable cardioverter defibrillators. this is only 2 years after recalling contaminated heart valves. from 2014- "the valves released have been sterilised using a recognised process but Corynebacterium was not included in the validation study and therefore Sorin Group Italia has assessed that there is a risk that the finished product is contaminated". the sept 28th recall, which was ultimately blamed on faulty software design, may have been avoided with more stringent QA Systems. what if one more set of eyes at $60k+ would have noticed the software's error. This is their third recall on a class 2 device in three years. I think its safe to say proper QA is worth the headache.

https://www.engadget.com/2016/09/13/samsung-loses-26-billion-market-value/
https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRES/res.cfm?id=158442
https://www.lexology.com/library/detail.aspx?g=e8770c90-f9e3-4e4e-abc3-2c614e833e08
https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRES/res.cfm?start_search=1&event_id=&productdescriptiontxt=&productcode=&IVDProducts=&rootCauseText=&recallstatus=&centerclassificationtypetext=&recallnumber=&postdatefrom=&postdateto=&productshortreasontxt=&firmlegalnam=Sorin%20Group%20Italia&PMA_510K_Num=&pnumber=&knumber=&PAGENUM=100

 
Posted : 01/10/2017 8:44 pm
(@dbonanno1)
Posts: 36
Eminent Member
 

Hello Professor, as someone who works as an R&D engineer and has a lot of experience working with the quality department I can relate to the notion of quality as “burden”. After spending so much time working with quality on the day to day tasks, I think it is sometimes easy to forget about the big picture that the quality department represents (as you have described in your post). That being said I do understand the need, purpose, and importance of the Quality department; but I do wish there was more flexibility on lower risk items that could help them be less of a “burden”. For example, product features/performances that pose very little risk to the end user and/or overall functionality of the product, should be treated as such. I think that sometimes because the quality department is driven so much by procedure it often creates complexities for very low risk items which then makes the action items related to the low risk items a burden. There will also be the need for procedures and compliance to the procedures, but there should also be some practicality/reasoning in how we adhere to them.

 
Posted : 02/10/2017 5:28 am
(@bb254)
Posts: 113
Estimable Member
 

Coming from an engineer working in the medical device industry, the quality department is crucial in the success of our products. Yes, at times the quality department is particular about matching certain standards which can cause delays in projects. Yes, we need to be trained every time quality documents get updated. Yes, the quality department does butt heads with engineers and scientist because of the statistical justification required for sampling. However, they are necessary in helping the company move forward rather than backward. This last month I was able to participate in an ISO audit and the quality department was on point with everything. Everything went so smooth, without any hiccups or concerns. Without quality assurance nagging us about certain methods and criteria’s then audits like the ISO audit would have been a disaster. It’s better off to pay someone 60k(+) a year then have an entire company get shutdown for recall or audit. The opportunity cost is justifiable for having a quality department (QA, QC).

 
Posted : 02/10/2017 6:01 am
(@asimbana)
Posts: 61
Trusted Member
 

QA/QC is the integral part of any medical device or any product in general. The department is practically a checks and balances for the product to ensure it meets it's intention without any defects. I can understand why companies may believe that QA/QC can be a burden to some, however they need to understand that these devices are interacting with people and their general well-being. The main motive is to solve a problem, not to create problems. The main idea for QA/QC is to protect their customers for most but also to protect the company from any possible litigation that may come with it. I believe that having QA/QC continuing their work is paramount to setting a high standard in the industry, sure the paper work is a annoying but it is important, there is a reason why it is used in industry and heavily monitored when it comes to the FDA in production. As the professor mentioned before, it takes one bad batch to ruin the reputation of the company and possibly go under, just because the company decided to make a bad mistake. In general, not everything is perfect, there is always moments where everything can go and will go wrong, whether it is an employee that had a bad day in the production line or a machine malfunctioned and failed to properly produce a device, these are scenarios that must be taken into consideration and a safety net needs to be implemented; these are what QA/QC employees focus on. In the long wrong, its an investment for the company and an important one. In 2017 alone, we experience how a bad batch of products can affect a company's reputation, as a previous user mentioned, Samsung alone is a perfect example of the exploding Note 7's and their battery issue. This problem cost the company millions on recall and lost dedicated customers from purchasing their products, which caused their other competitor to gain profit on this mistake.

 
Posted : 02/10/2017 6:23 am
(@dag56)
Posts: 79
Trusted Member
 

The idea that spending ‘excess’ funds on quality engineers is a burden and that they only bring bad news has been the general consensus of the previous companies for which I have worked. Currently at my job, upper management, engineers, and technicians alike both dread missing the standards the quality team sets for a product because that means sending the immunoassay instrument back into the laboratory to repeat roughly two dozen hours laboratory testing. Inevitably, this means retesting an instrument (frustrating to begin with) in addition to logging significant overtime in order to meet the monthly quota.

Even though I am part of this cycle and have had my fair share of overtime hours, I believe that an excellent quality team is definitely a necessity when it comes to medical devices. In my case in particular, if an instrument leaves the manufacturing plant defective, that could put an entire hospital’s patient body at risk for faulty lifesaving diagnostic test results. In addition, as mentioned above, the company image would be negatively affected by frequent recalls of product. This pairs with the financial payout the medical device company would have to pay to both recall their product and in the coming civil suits. Therefore, we as employees of medical device companies owe it to our client, to ensure quality is built into every step of our medical device process to give them the most reliable device we can.

 
Posted : 02/10/2017 9:57 am
(@smitshah)
Posts: 75
Trusted Member
 

Quality is an and should be considered as an integral part of the company. It doesn't matter what is the size of the company but there should always be a set form of procedure to maintain accountability and flexibility to trace a product backwards to its whole batch in situations to back trace a product lot. This all things can only be achieved only when there is a system in place. Especially in medical device company which always deals human life they need to be accountable.
Even when a company thinks from business point of view allocating sufficient fund would be like an investment into something which ensure following services:
More trust of consumers in a company product.
Better quality product
Prevents company from loosing money from sues.
Gets the products certified from more regulatory boards ( which would be a big plus if its a Multi national Company)
Responsible for accountibility of the manufacturing processes.
Evaluation of vendor material.
Basically a service which prevent loss of money and make sure that anything that goes out in the market with company name on it has been proven to standards is something worth investing money into.

 
Posted : 02/10/2017 2:18 pm
(@alexandrabuga)
Posts: 149
Estimable Member
 

I echo the sentiments of others like @asimbana and @bb254 that QA/QC is necessary and is crucial to the success of products. Spending extra time and money and going through QA/QC processes/methods isn't ideal, but it is necessary to lower risk. For example in 2010 Johnson and Johnson underwent a quality control reorganization after both the House Committee of on Oversight and Investigations and by FDA's office of criminal investigations found violations in two McNeill plants. Due to this McNeill had to recall millions of bottles of adult Tylenol because a byproduct of a chemical used to treat wooden transport pallets had leaked into the products, resulting in the moldy smell.

Then 3 months later McNeill had to recall over 136 million bottles of children's liquid Tylenol because they might have contained too much of the active drug ingredient or foreign particles.

The Johnson & Johnson’s recalls and plant shutdown cost J&J over $200 million in sales that quarter and lost over $600 million in annual sales because of the plant closing. $600 MILLION. So yes, there is a Cost of Quality, but there is also cost and risk if not followed properly. Even the big companies like J&J can suffer and have a hit to their bottom line if the QA/QC aren't functioning properly.
http://www.nytimes.com/2010/08/19/business/19drug.html

 
Posted : 02/10/2017 4:45 pm
(@reshamn)
Posts: 67
Trusted Member
 

Quality control is very essential in building a successful business that will deliver products and exceeds customer's expectations. There are many reasons why quality control plays such an important role for a company. It allows to compete in the industry well. If a company is following proper quality standards, it is obvious that it will be a far more superior product than their competitors. Since that product is well tested beforehand, it can be priced higher which brings the company more profit. Yes, there is initial investment of testing and quality employees, however the return of that investment is profitable. Not only it allows one to compete well in the market, but wins a customer's loyalty. If I am satisfied with a particular product, it will take a lot more for another company to sway me. It builds a customer's confidence in the company and they don't even have to research much before buying it. Due to all of these reasons, it builds a brand and its reputation.

 
Posted : 03/10/2017 11:19 am
(@srg36)
Posts: 117
Estimable Member
 

I agree with the general consensus in the above posts that the quality assurance process and quality control process is very important to ensure a device will be safe and reliable for the end user. However, I also agree with those who view the quality processes to be burdensome as well. Speaking from experience, the quality department seems to think that the more procedures that they have in place, the higher the quality of the product will be. I don't necessarily agree with that sentiment. There comes a point where the quality documentation becomes so expansive that it is very easy for something to slip between the cracks, making the company more susceptible to an audit finding that they aren't complying with their own procedures. I think companies need to be very careful about "over-proceduralizing" their quality system. Another thing I have noticed is that with so many procedures, you can lock yourself in a little box, and when a situation arises that may not exactly fit the procedures in place, quality does not know how to react, and they go back and forth about how to handle the situation. I believe that is another reason why the quality department has the tendency to be viewed as burdensome.

 
Posted : 04/10/2017 8:33 am
(@merzkrashed)
Posts: 123
Estimable Member
 

Quality costs are the all the costs that a manufacturer incurs to ensure it produces a quality product. Quality costs to prevent low-quality production costs and costs that arise after a low quality product is produced, so the cost of poor quality can cause rework, retesting, delay,and loosing money too.
I think the success of any medical device industry is contributed by different factors such as global market growth, technology innovation, financial investment, educated human resources, governmental initiatives (FDA), and QA/QC people.
QA professionals should make sure that the products meet FDA-current Good Manufacturing Practices (cGMP) and internal standards. They are also responsible for training, audits, documentation, and communication to leadership to prevent extra costs for poor Quality.

 
Posted : 04/10/2017 8:52 am
(@myton)
Posts: 77
Trusted Member
 

There are always people who exist who have contrary views with anything. It is true that it is better to prevent than to cure. It falls true for medical treatment but it also falls true for business. When someone is in the risk of the getting sick, it is better to take medicine that will help in the prevention of the sickness rather than getting sick and that illness will take toll on your body and leave some damage. The same is true for business. Although there is a high cost in the installation of a quality control section, it is less costly compared becoming sued and spending money on products that are defective. Everything costs something and it is just important to realize the tradeoffs: the risk and rewards. From that, you can see that you save more by using quality control techniques. It is also important to point out that not only are you able to save money but a quality control department will ensure that you have a product that is in its best possible capacity and is able to compete with the leading-edge products that are in circulation today. This is important in today’s world where the best are the only ones that survive.

 
Posted : 06/10/2017 9:52 am
(@gaberuiz13)
Posts: 35
Eminent Member
 

To those who say quality is a burden I can see where they're coming from. With QA/QC in place, a lot of money has to thrown into a process that hinders the launch of a product, but it is a necessary burden. Spending ~$500k on QA/QC is astronomically better than losing +$1Mil to lawsuits and recalls simply because QA/QC was "too much of a burden". Yes, there's a lot of paperwork and extra steps in assuring the product is safe for use; however, these standards are in place because carelessness in biomedical devices and drugs could very likely lead to hurt customers or worse. QA professionals will assure a product meets the standards of different organizations whom via extensive research and trials have formulated their standards to assure safety and efficiency. In the contrast, being overprotective or over-doing QA can lead to faults down the line; however, I feel as though in this case, more QA/QC is better up to a certain point.

 
Posted : 06/10/2017 11:41 am
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