The Cost of Quality, sometimes referred to as COQ, is a measurement that sums up the costs related to the prevention and subsequent detection of defects, and the costs associated with these defects. The COQ defines the total costs of quality activities. This is money spent beyond the basic production costs to ensure that the customer receives a quality product. Let's take a look at how COQ is calculated.
The COQ includes the money spent on prevention, appraisal, and correction in a production environment. COQ can be expressed as the effort in terms of time, but it is probably best served as a calculation involving money.
The calculation itself is not complicated, and it is the addition of two compound values (which makes this the most straightforward approach to COQ):
The Cost of Control and Cost of Failure of Control each require a calculation based on their components.
Cost of Control
The Cost of Control can be defined as follows:
The Prevention Cost is the amount of money spent to prevent defects incurred during the manufacturing process. All Quality Assurance programs and efforts are included in this number, including any preventive measures taken.
The Appraisal Cost is the cost associated with all efforts focused on the detection of defects. The cost associated with Quality Control efforts are included here, including final testing and other forms of quality control.
Cost of Failure of Control
The Cost of Failure of Control is sometimes known as the Cost of Non-Conformance. This is the total cost of failure within the manufacturing process. It is broken up into Internal Failures and External Failures.
Internal Failure Cost is the direct cost associated with internally recognized defects and the costs associated with correcting them. For example, this would be the expense of fixing the discovered defects and retesting them, also known as Cost of Rework.
External Failure Cost is the cost associated with defects discovered by the customer and their correction. This Cost of Rework for external failures can include such items as product service, liability issues, and recalls.
Getting the COQ to a minimum requires careful balancing between the Cost of Control and the Cost of Failure of Control. The prevailing thought is that an increased Cost of Control will keep the Cost of Failure of Control to a minimum.
However, in most practical applications an increased Cost of Control can rapidly approach a diminishing return on investment when it is raised beyond a certain degree of effectiveness. The key is to keep the costs balanced as needed.
Quality has a price that can be calculated and studied. But the importance of maintaining the business image has many returns in repeat business and word of mouth.
For more information on how Accupoint can help your organization monitor and reduce your COQ, please contact us today.
Building situational awareness in oil and gas operations has always been vitally important. Without a strong foundation of situational awareness, there can be severe consequences. In fact, 88% of human error can be traced to a lack with situational awareness. Not just that, situational awareness can negatively affect oilfield operations and the ability to project future events.
Many offshore installations have the capacity to be hazardous and despite numerous rules and regulations in place to ensure that the risk of accident is kept to a minimum; accidents still occur. Having good situational awareness contributes towards the reduction of accidents. Situational awareness, or SA for short, is vital for when work being carried out is hazardous, or has the potential to be hazardous, as the workers must constantly monitor and evaluate conditions in an attempt to reduce accidents.
In a nut-shell, situation awareness can support decision making and aid performance. In fact, situation awareness is key to good decision making and safe, efficient performance.
Although situation awareness seems relatively easy to comprehend, some people struggle with it. Specifically, 78% of people don’t get the information that is needed. 17% of people do not correctly understand the information they receive and 5% of people don’t project what will happen in future.
Situation awareness is important for many factors and is the responsibility of the entire crew. Between us, we can reduce the risk of accidents and ensure a safe working environment for everyone in the gas and oil industry.
For more information on how Accupoint Software can help improve your situational awareness, please contact us today.
Quality management for service supply organizations in the petroleum industry is ever-changing due to increasing demands from customers to adopt new standards and avoid future catastrophes. The API Spec Q2 standard outlines a risk-based quality management system as compared to a processed-based management system. API Spec Q2 is now fully implemented and accepting applications for certification from organizations around the world. This certification is rapidly becoming a requirement for many service supply organizations and will expand to become a global mandate in the near future.
Applicants must have procedures in place to address dozens of key QMS elements. These pertain to risk assessment, contingency planning, management of change, service-related product, process design, supply chain controls, and service quality planning. Other requirements involve preventive maintenance, inspection and test and the competency of personnel. According to John Modine, API’s vice president of Global Industry Services, “Any drilling service provider who is in compliance with the requirements can now receive API Spec Q2 certification.”
SAM API Q2 Solution
Accupoint’s web-based solution is an easy-to-use API Spec Q2 management system designed to ensure that compliance requirements are managed and monitored consistently. Using the latest technology and industry best practices, SAM™ streamlines the process and ensures an easy integration into this new standard. In addition, the solution is accessible from any web enabled device and connects multiple locations with real-time communications and up-to-date records and information.
The SAM™ platform simplifies management of the requirements of API Spec Q2 standard, allowing for easy integration and compliance. It addresses all the key required components including;
Obtaining API Q2 certification is just the first step. Ensuring your quality management system stays compliant is the next. With 43 integrated modules and 85 built-in reports, administration and surveillance of the API Spec Q2 requirements is ensured. Contact us for any additional questions you may have on how to implement and maintain an API Spec Q2 quality Management program.
Regardless of the industry you work in, calibration is one of those things you simply cannot overlook. Inspection equipment needs to function reliably and accurately. Calibration ensures consistency and is a requirement of quality management standards across the globe. In this week’s blog will examine four key steps to ensure that your organization is ready for your next audit.
The Calibration process does not have to be time consuming. With the right systems in place, you will be prepared for any audit, as well as have the peace of mind that comes with protecting yourself from liability. For more information on how Accupoint Software can help simplify the calibration process, contact us today.
1. the quality of being honest and having strong moral principles; moral uprightness.
The Net Promoter Score (NPS) can be a great tool to improve the customer satisfaction of your business. It can also help to expand your customer base. NPS is a simple process, but the effects can have a significant impact on your business. Let's look at the advantages of NPS.
1. The NPS Process Is Customer Friendly
How likely is it you would recommend us to a friend or colleague? Determining the NPS requires only asking the single question above. When you ask it, the customer responds with a range from 0 (not at all) to 10 (extremely likely.) It requires minimal effort on their part. By asking only a single question, the customer is more likely to take the time to give an answer. The last thing you want to do is to burden your customers with an exhaustive survey. Since they are not, the customer will provide accurate information and still leave in a good mood.
2. NPS Provides a Target for Focusing Customer Relations Efforts
NPS gives a clear picture of how customers view your products and services. People tend to be conservative when it comes to making a recommendation. By asking this question, you can get a good measure of the customer's satisfaction. Once you have the measurement in place, it gives you a clear goal to focus on while you try to raise it. The goal should be to move all the detractors (those with a score of 0 to 6) to a passive level (7 or 8.) And you should, in turn, move all the passives you can to promoters (9 or 10.) Promoters can do incredible things for your business when it comes to getting the word out.
3. NPS Can Reduce the Cost of Customer Acquisition
The best way of increasing a customer base is by word of mouth. Since the NPS is a direct measure of how likely this is to happen, it gives you a very focused metric on which to improve. You will want to nurture low scoring customers. Doing this will increase the likelihood of future product and service recommendations. Taking care of low scoring customers will also help to keep them coming back for more business. Every saved customer relationship is one you don't have to pay to replace later. This can have a positive impact your bottom line. The NPS can be a simple yet powerful tool in customer relations for your business.
Contact us today for more information on how Accupoint Software can help streamline your customer bench-marking process.
For more information on Accupoint Software's SAM Q2 platform or to schedule a demonstration, please contact us today.
With the changing landscape of the oil and gas industry, companies are under increasing pressure to improve operational efficiencies as prices continue to remain low and margins are narrowed. In order to reduce costs and increase efficiency, many service supply organizations are implementing API Spec Q2.
Accupoint’s SAM™ solution ensures compliance and the correct documentation to meet the API Q2 requirements. It defines strategies, goals and best practices and the means to secure them. Our system provides industry best practices for all components including: service quality, risk assessment, employee training, document control, MOC, corrective actions and preventive maintenance. A comprehensive solution may seem difficult for an industry with such vast core areas to cover; however, incorporating common standards of practice is essential to realizing integrated process management and operational excellence simultaneously.
The bottom line: API Spec Q2 tells your customers that you are at the top of your class and aiming for the best in quality and delivery of services, ultimately ensuring customer loyalty, operational efficiency and growth.
Please contact us today for more information on our family of quality management systems specific to the petroleum industry.
During the stages of conception, designing, building, operating, and decommissioning in the petroleum industry, a quantitative risk analysis is a primary tool used to analyze the safety and risk management in an effort to control hazards and operate safely. The quantitative risk analysis can identify potential hazards, determine the likelihood of them occurring, and the consequences of the hazard should it arise.
Why Quantify Risk?
Your company needs to be reliable and safe in the competitive petroleum industry. The potential harm to employees, the environment, assets, reputation and the local community should be priority number one.
How Do You Quantify Risk?
In most scenarios, the use of a HAZID can be applied. A HAZID can help identify the potential risks during installation or operation of your company's work. Often, a hazard can become a series of hazards as they break down into a plethora of hazards, also known as an event tree. That is, when one operation breaks down, the HAZID can pinpoint the likelihood of the consequential events that may happen. Not only can the HAZID determine what might happen next, the HAZID can also quantify the probability of the events to follow.
Planning for the Future
With the risk analysis tools in place, your company can easily plan for the future by identifying your risks and quantifying the likelihood of their occurrence. With proper risk management, your company can avoid unnecessary costs, downtime, and injury to workers.
For more information on how Accupoint’s solutions can help you manage your risk assessment process, please contact us today.
Recording process information in oilfield operations can be extremely difficult. Furthermore, documenting everything on paper and storing it in files has become unworkable and unnecessary. While these tasks were traditionally done on paper, the scale and complexity of operations today make it almost impossible. Instead, firms are moving to automate process control documentation. This shift helps to reduces cost, increase efficiency, and improves organization and retrieval.
Documenting customer and regulatory mandated process information is one of the more tedious components of oilfield operations. Managers want to focus on increasing efficiency and productivity. They want to produce more volume for the same amount of labor and energy input. In contrast, process control documentation is mostly focused on recording past actions and complying with regulation. For that reason, automating the documentation process continues to grow in popularity.
A main benefit of an automated software system is the ability to record process information as it occurs. Software will allow users to record the inputs, the timing of each chemical additive, the drilling schedule, the pumping schedule, heating, cooling, water injection and many more processes.
Managers and compliance professionals can examine these results in the event of an incident or other non-conformity. Records and related information is saved in the cloud automatically, so there is no need to worry about papers or hardware being destroyed or misplaced. Instead, the data is safely stored in redundant server locations.
Accupoint Software is a leading provider of innovative compliance management systems for the petroleum industry. Our integrated platforms streamline business processes, improve efficiency and help navigate complex regulatory and customer requirements. For more information on our solution family, please contact us today.