ABSTRACT
CONC is a “value of nonconformance cost” as measured by the inclusion of the “big seven” (numbers can be derived from a software such as Encore or compiled manually):
1. Product warranty 2. Rework 3. Scrap 4. Excess and obsolete inventory 5. Maintenance 6. Overtime (premium) 7. Premium inbound and outbound freight
Product Warranty
Product warranty is expressed with two subaccounts:
• Field failure costs • As-received failure costs
• Covers product deficiencies starting with the delivery of the equipment or service to the customer and excludes carrier damage.
