Cobalt Robotics: Inspect More, or Fix the Line?
Cobalt Robotics manufactures industrial robotics products in Japan, running 743,628 units a year.
Internal quality checks reject 3.3% of output, at a scrap and rework cost of about ¥543 a unit. A further 2.1% of shipped units come back under warranty, each costing roughly ¥1392 once field service, replacement and admin are counted.
Two proposals are on the table. Engineering wants ¥82 B of one-off capital to re-tool the station where most defects originate. Quality wants ¥33 B a year of additional inspection headcount to catch more before shipment.
The plant manager is measured on unit cost.
volume
- units per year
- 743628
proposals
- process retool one off b
- 82
- additional inspection per year b
- 33
external failure
- cost per claim
- 1392
- warranty claim rate pct
- 2.1
- warranty units per year
- 15616
internal failure
- defect rate pct
- 3.3
- defective units per year
- 24540
- scrap rework cost per unit
- 543
Advise the plant manager. Your answer should provide:
- Analysis — the total cost of poor quality today, split by where it is detected, and the return on each proposal.
- Risks — what each option does not solve.
- Recommendation — which to fund, with a payback period.
State any assumptions you make.
80 points, 60% to pass.
- recommendation20
- market analysis15
- risk assessment20
- financial analysis25
Reveal suggested structure
Cost of poor quality = internal failure + external failure. Compare prevention against detection on payback, and note that inspection does not reduce the defect rate.