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Dkonara921 replied to the topic Discussion Topic: The cost of Quality in the forum Quality Control and Quality Assurance 7 years ago
For this, it’s important to do a Cost-Benefit Analysis to see how much “bang you get for your buck.” Paying for quality is important in order to avoid legal liability for any mistakes that produce very negative results. However, one important that should be considered is that the gap between cost and benefit needs to be high, which needs to happen in order to make the highest profits possible. The hard part of investing in quality assurance is knowing how much is required to ensure that your quality remains high. In economics, there is a law called “The Law of Diminishing Returns,” which simply states that investing too much in one area will lead to negative results in the long run and can even slow processes down. Knowing how many employees to hire and making the optimal procedure for R&D are very hard things to do because it’s not a clear answer. It’s true that a company may be able to live another day if it commits a crime and loses a fortune through a lawsuit, but you also have to consider that companies that don’t produce and innovate constantly won’t live for long and will probably suffer because of competition. If customers are mostly unsatisfied with what a business is offering, then it will not survive as it’s survival ultimately depends on the customer.