Originally Published MDDI January 2006
Catching a product defect early is key to lowering company costs. If device makers apply preventive actions, they'll save themselves a lot of time and money, said Dan Olivier. He is president of Certified Software Solutions Inc. (San Diego). By applying a method called the cost of poor quality (COPQ), companies can calculate the costs of inefficiency and waste during manufacturing.
COPQ is the difference between the real cost of production or services and what the cost would be if the products were defect-free. “What COPQ shows us is that the further down the process we are when we find a defect, the more expensive it is to correct,” said Olivier. He spoke during an audioconference produced by Certified Software and Compliance Alliance LLC (Arlington, VA). “Surely if a problem is found in the field, it's much more expensive to correct than if we found it in-house via testing.”
In general, the device industry is somewhat behind other industries with respect to implementing preventive actions, according to Olivier. This is partly because of the regulated nature of the device industry. Some OEMs tend to focus more on documentation and less on improving quality and implementing continuous improvement programs, such as preventive actions.
By investing in preventive action, device makers can have a long-lasting and major return in failure reduction. There's also no recurring cost. “It's a one-time cost that continues to pay dividends,” said Olivier.
The COPQ model ranks the activities that are most likely to result in cost savings. However, for the program to be successful, manufacturers need to get support from management and finance departments. They should also be conservative when estimating cost savings. The model has to be believable, said Olivier. Once a firm moves forward, it should offer training on the principles of the COPQ model and tailor it to the firm's needs. Some firms have invested a lot of money into the training in root cause analysis, because it helps identify appropriate corrective actions.
Some firms have integrated product stress and reliability testing into validation. “In my work with medical device manufacturers, most recalls related to design are related to unpredicted failures,” said Olivier. These failures involve an unusual circumstance when traditional validation testing does not uncover the problem. This could be an instance in which a product has been in use for a long time before a defect occurs. Such recalls are instituted once the device maker realizes there's a latent defect that was never discovered, Olivier noted.
When taking actions to prevent defects, one of the most effective steps is to look at the firm's own history and past problems. Identify how those problems can be prevented in the future. Firms should challenge their own manufacturing, engineering, and other areas to think about which practices result in a reduced introduction of defects.
Olivier and Nancy Singer, president of Compliance Alliance, will speak about the COPQ process on January 31, 2006, at the MD&M West trade show in Anaheim, CA.
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