Sunk costs are defined as costs that have already been incurred and cannot be recovered. Proponents of the sunk cost fallacy argue that since it is a cost paid in the past and unrecoverable, it should be removed from any future decision making. 

Imagine this: Company A is an internationally respected, world-class company that manufactures high-end kitchen appliances. Their products are coveted by homeowners across the globe. 

Consistent product quality is the most proven predictor of any manufacturer’s success. Competitors may imitate each other’s marketing, but superior quality stands alone as the truest statement of company’s values. That is why forward-thinking manufacturers are making quality cost management part of their DNA.

Most manufacturers will at some point overlook an out-of-control process and deliver an out-of-spec product. 

When you look for the root cause of scrap—and solve it—you’re likely to reap benefits throughout your entire operation.

The cost of quality isn’t discussed much. More often, the cost of poor quality hogs the limelight and the headlines. Cost of poor quality costs are believed to be 100% avoidable, and thus are assigned resources to expend extra attention and efforts to eliminate. 

“Lean isn’t going to help you if your quality is bad. Why just make bad stuff faster?”

I’ve written a lot about the growing benefits that Enterprise Quality Management Software (EQMS) can deliver.

Successful change agents consider the big picture.