Quality Costing Technique: An Appropriate Financial Indicator for Reducing Costs and Improving Quality in the Organizations

Abstract

Quality costing method is one of the total quality management (TQM) tools. This technique is also the most significant financial performance indicator, which can assist the companies to monitor and control their expenses related the quality of products and services during production process, in order to ensure that the firm is able to satisfy the requirements of the customers. Accordingly, the adoption of this method can cause that the companies save money and being more competitive in the market. However, the main purpose of this paper was to explore and discuss regarding the aspects of this TQM tool, and how it can detect unnecessary costs and maintain good quality for products and services with an aim to attain highest level of customer satisfaction in the organizations.