Effect of ISO 9001 non-conformity process on cost of poor quality in capital-intensive sectors

Abstract

Purpose – The purpose of this paper is to investigate whether there are differences in terms of the effect of the ISO 9001 non-conformity process on the cost of poor quality in different sectors. In particular, to investigate the effect on six sectors of companies which manufacture their products mainly through machines and plant (i.e. capital-intensive companies). An additional aim is to understand what the reasons for these differences are and why ISO 9001 has limitations in reducing the different categories of costs of poor quality. Design/methodology/approach – The paper is based on a questionnaire administered to a sample of 42 companies divided into six different sectors: chemical, pharmaceutical, mechanical, food, ceramic and steel. Respondents were asked to give a percentage score for the contribution the ISO 9001 non-conformity process makes to the reduction in total cost of poor quality and to its categories: scrap, rework, machine stoppage, re-inspections, rejected products and recall cost. A one-way Anova test was applied to the means of the percentage scores to determine whether there are differences between the means of the total cost of poor quality and its categories. Qualitative comments and suggestions from the companies provided information that helped explain the reasons for such differences. Findings – The results of the research show that there is no difference within and between the sectors in the means of the total cost of poor quality and scrap cost, whereas there are significant differences in the means of the other costs of poor quality between the six sectors. The ISO 9001 non-conformity process has limitations in reducing the costs of poor quality and suggestions concerning the limitations of ISO 9001 in the Research and Development process emerge. Research limitations/implications – The generalizability of the research findings is limited because of the use of just six sectors of capital-intensive companies. Further research about differences in different sectors is needed. Practical implications – The implications of this research are useful for consultants and managers who want to understand what the limitations of the ISO 9001 non-conformity process are on the cost of poor quality in the six sectors. The findings clearly show how, together with ISO 9001, they should take into account other improvement processes such as periodic maintenance and revamping. Originality/value – The paper discusses in a quantitative way and for the first time the effects of the ISO 9001 non-conformity process on the cost of poor quality.