Calculating and Reporting Benefits of QMS. Iowa State University of Science and Technology Agriculture and Biosystems Engineering Agriculture and Industrial Technology 7/15/05. Objectives.
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Iowa State University
of Science and Technology
Agriculture and Biosystems Engineering
Agriculture and Industrial Technology
“The organization can use a variety of financial decision methods (e.g. net present value, payback time, internal rate of return) to decide whether to proceed or not with a cost benefit analysis”
(ISO/TR 10014:1998(E): Guidelines for Managing the Economics of Quality)
present worth of total benefits
present worth of total costs
If ratio is greater than 1, project deemed worthwhile and vise versa
NPW=present worth of total benefits –
total worth of total costs
Regardless of above,