Innovative system to determine hidden cost of poor quality to enhance labor productivity and profitability for construction entrepreneurs, a case study
Cost of Poor Quality (COPQ) would not have been expended if the job is done right the first time. Some researchers claim that COPQ ranging between 22 to 32% of total revenues remains hidden and project managers fail to initiate corrective actions. COPQ is an un-necessary burden; it reduces productivity and profitability. Therefore, an innovative system is required to identify and measure COPQ at construction projects to initiate prompt corrective actions. The researchers innovated a COPQ system and tested on a public sector construction project to find its effectiveness in reducing COPQ and enhancing labor productivity and profitability. After the sixty-days study project the COPQ reduced from 40.43% to 16.65%, labor productivity improved by 16.88% and profitability increased by 10.45%. This study validated the COPQ system for use on construction projects to bring continuous improvement in labor productivity and profitability of construction companies.