Internal Failure Costs Notes: Definitions & Explanations PDF | Download eBooks

Study Internal Failure Costs lecture notes PDF with project management definitions and explanation to study “What are Internal Failure Costs?”. Study internal failure costs explanation with project management terms to review project management course for online MBA programs.

Internal Failure Costs Notes:

Everything comes with a cost. When an organization tries to reduce the costs associated with non-conforming products, still costs related to the efforts of reducing non-conformities incur. These costs must be managed well carefully. The costs related to the quality activities are collectively called costs of quality. One of the quality related cost is called internal failure cost. As the name indicates, internal failure costs are the costs that are linked with the failure of the products. The word 'internal' with the failure costs refer to the fact that the products are failed within the organization before they are shipped to the customer. When a finished item is inspected and a defect is detected, it must be reworked if possible or is scraped. The costs associated with this rework or scrap is called internal failure cost.

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