Double Cost
When defect account for double

Last update: December 26th, 2008
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Batch rejected by inspection

Imagine a customer order consisting of a batch of four units.

Just before shipment, inspection notices one of the four units is defective.

Now the batch cannot be shipped as is, the defective unit has to be recovered.

Two solutions to recover:

  1. The defective unit can be repaired or reworked
  2. The defective unit can not be repaired, it has to be replaced

In both cases, the solution will carry additional costs for the maker.

The unit can not be repaired neither reworked

"Can you recover this defect quicly?
It is an urgent shipment and this unit is defective

"I see, this defect can not be reworked nor repaired. We have to make a new one for replacement, as this one is just to be disposed!".

"Ok, make one, but quick, the shipment is due!".

Double Cost

"What a waste, make a new unit will be expensive:

  • I must interrupt the actual production batch and changeover to make this single one in a hurry! To finish all up, I have to work overtime.

  • I need raw material, my labor cost and energy

The disposed unit already consumed all this, so that means every defect carries a double cost!

Author, Chris HOHMANN, is managing partner @ Agamus Consult

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