---
title: "Cost of quality"
subject: "ICT Project Management"
chapter: 10
key: "semester_7/ict_project_management:cost-of-quality"
source: https://www.bctengineer.com/q/semester_7/ict_project_management/cost-of-quality
site: BCT Engineering
---

# Cost of quality

ICT Project Management · Chapter 10: Project quality management

- Asked in: year not given
- Video: [Project Quality Management Overview | PMBOK Video Course](https://www.youtube.com/watch?v=Q7YJ-_OJIZQ) — David McLachlan
- Answer checked by Claude Opus 5.5 (high effort) on 2026-10-14
- Page: https://www.bctengineer.com/q/semester_7/ict_project_management/cost-of-quality
- Whole chapter: https://www.bctengineer.com/md/semester_7/ict_project_management/chapter-10

## Question

What do you mean by cost of quality?

## Short answer

Cost of quality (COQ) is the total cost of conformance (prevention and appraisal) plus non-conformance (internal and external failure). The 1-10-100 rule: preventing a defect costs 1 unit, testing finds it for 10, fixing after delivery costs 100; investing in prevention lowers total cost.

## Answer

**Cost of quality (COQ)** is the total cost of all efforts to achieve product or service quality, plus the cost of failing to achieve it. It covers the work to prevent defects, find them and correct them. Juran introduced the cost-of-quality idea, and Philip Crosby, in his book "Quality Is Free", argued that prevention costs less than failure.

#### Categories
1. **Conformance costs** (cost of good quality): money spent to avoid failures.
   - **Prevention costs**: training, quality planning, process improvement, documentation, better tools, standards.
   - **Appraisal costs**: inspections, testing, reviews, audits, test equipment.
2. **Non-conformance costs** (cost of poor quality): the cost of failures.
   - **Internal failure costs**: failures found before delivery: rework, scrap, retest, delay.
   - **External failure costs**: failures found by the customer: warranty, complaints, support, recalls, liability, loss of reputation.

| Category | Examples in a software project |
|---|---|
| Prevention | Training in secure coding, standards |
| Appraisal | Code reviews, test execution |
| Internal failure | Fixing bugs found in QA |
| External failure | Patches after release, customer compensation |

```text
Cost
  |  Failure cost  \
  |                 \_____
  |  Prevention + appraisal  /
  +-----------------------------> quality effort
```
Spending more on prevention and appraisal lowers failure costs and, up to a point, usually gives the lowest total cost.

#### Use of COQ
- Cost-benefit analysis in quality planning.
- Justifying investment in quality improvement.
- Monitoring trends; a rising failure cost shows a process weakness.
- Comparing projects.

#### The 1-10-100 rule
A defect costs 1 unit to prevent, 10 to find and fix in testing and 100 to fix after delivery.

**Example:** A team spends Rs 50,000 on code reviews (appraisal) and avoids Rs 3 lakh of post-release fixes (external failure).

## Check yourself

The answer's key points as multiple-choice questions, with the correct option and why.

1. What does cost of quality include?
   A. Only the cost of testing
   B. Only the cost of defects after release
   C. Cost of achieving quality plus cost of failing to achieve it
   D. Only the cost of training
   Answer: C. COQ covers conformance (prevention, appraisal) and non-conformance (failure) costs. (Key point: Definition)

2. Which is an appraisal cost?
   A. Code reviews and test execution
   B. Warranty claims
   C. Rework of bugs found in QA
   D. Secure-coding training
   Answer: A. Appraisal covers inspections, testing, reviews and audits. (Key point: Categories)

3. Which is an external failure cost?
   A. Code reviews
   B. Fixing bugs found before delivery
   C. Process improvement
   D. Patches after release and customer compensation
   Answer: D. External failures are found by the customer after delivery. (Key point: External failure)

4. What does spending more on prevention and appraisal usually do?
   A. Raises failure costs
   B. Lowers failure costs and total cost
   C. Has no effect on failure costs
   D. Eliminates all appraisal costs
   Answer: B. Quality is free: prevention costs less than failure. (Key point: Prevention vs failure)

## Related in ICT Project Management

- [Quality planning](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aquality-planning) — ICT Project Management, chapter 10
- [Project quality](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aproject-quality) — ICT Project Management, chapter 10
- [Total quality management](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Atqm) — ICT Project Management, chapter 10
- [Quality management plan](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aquality-management-plan) — ICT Project Management, chapter 10
- [Quality assurance](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aquality-assurance) — ICT Project Management, chapter 10
- [Quality audit and approach](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aquality-audit) — ICT Project Management, chapter 10

## Related in other subjects

- [QA vs QC; types of cost of quality](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aqa-vs-qc-cost-of-quality) — Project Engineering, chapter 4, asked 2×
- [How CM helps with delay, quality and cost](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Acm-course-delay-cost) — Construction Management, chapter 1
- [Monitoring and quality, cost, schedule control](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Amonitoring-quality-cost-schedule-control) — Project Engineering, chapter 4
- [Quality; cost of quality; assuring quality](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aquality-cost-of-quality-assured) — Project Engineering, chapter 4