What is the cost of porr quality in your company?

Hi Douglas, Do you mean Cost of Poor Quality (COPQ)?
I knew this while reading a book talking about Six Sigma, it's telling me how to measure, calculating and reducing it.
The only way to know and reducing it by implementing a Quality Management System, but the fact that this system not well apply in companies in Vietnam and this variable depend on type of their business or manufacturers..20%- 35% is an acceptable number in Vietnam I think.
As far as I know for a fortune 500 companies in US calculated their COPQ around 10%, 25% seem too high and need to reduce some...

I do not know clearly on how to calculate the cost of losing customers, if this one is included the poor quality cost may be increased more than any limits !

Yes indeed, COPQ.

Are Vietanmese companies really prepared to accept 25% off the bottom line? Come on guys! 2% is barely acceptable, surely?

I am curious to here why 25% is an acceptable figure?

The really big question is, do Vietnamese companies know what the cost to them is in reality? and why would you ignore such a potential saving?

When you show the figure, Douglas, it's obvious that 25% is unacceptable. However this cost is NOT obvious as money throw out of the window. It's very subtle with no clear benchmark, so it doesn't really cause the fierce pain daily. Some company I know, only until after deploying some QA system and measure the cost they have save, then they really know how much was wasted before:)
@ Hoa: Since you have read the book about reducing this cost, can you share some?

Like any other cost, the cost of quality (good or poor) has to be sustained by any business. The point is, if you donot account for this, you will have no understanding of what affect it is having on your profit.

Every time I ask this question, the answer I get from executives is that they do not believe that there is significant costs to show concern over. On these occasions I go on to prove that these 'insignificant costs,are somewhat more significant than realised by the MD.

If you waste 25% of your profit due to poor quality, why not invest 5% in making the quality level better? Why do you need to set up a "QA system" why not just use your existing accounting system? Just refocus it to account for wasted effort, work that is non-value adding or aimed at catching things that are incorrect? Why not refocus the effort of managers to look at what iadds value and what does not in terms of your delivery process? You may want to call this system a Quality Management System?