The Malcolm Baldrige National Quality Award has seven different areas of a business it looks at when choosing the one that most fits these criteria. These seven would include leadership, strategic planning, customer and market focus, information and analysis, human resource development and management, process management, and business results. Developing quality specifications of a product are very important to the total quality management philosophy. There are many components to this part of the process. Design quality is the inherent value of the product in the marketplace and is therefore a strategic decision for the company.
Conformance quality is the degree to which the product or service design specifications are met.
Quality at the source is frequently discussed in the context of conformance quality. Cost of quality analyses is quite common in industry. Basically, this means all of the costs pertain to the production of quality that is not 100 percent perfect. The costs of the inspection, testing, and other tasks to ensure that the product or process is acceptable. The sum of all the costs to prevent defects, such as the costs to identify the cause of the defect, to implement corrective action to eliminate the cause, to train personnel, to redesign the product or system, and for new equipment or modifications.