Quality may be defined as the timely and compliant implementation of regulatory requirements at an optimized cost-benefit ratio. It is difficult to budget quality costs, because partly they are hidden costs which result from under or over compliance. In the domain of optimal compliance the quality costs and the compliance with regulatory requirements are well-balanced (see GxP Compliance).

Compliance risk (non-compliance): In the case of under regulation the quality costs are apparently low, but they may increase significantly in the case of authority complaints or customer reclamation. The consequence can be the loss of confidence and therewith delayed business opportunities or breakdown of business relations. Reasons for underachievment in compliance can be:

• Deliberate decision of the management to establish a "lean" QM system
• Missing role model or lacking support by the management
• Lack of communication or insufficient communication
• Missing quality awareness or understanding of the personnel
• Disadvantageous personnel planning (e.g. overburden of the personnel by day-to-day business)
• Weak quality assurance (e.g. resources, influence, missing support by management)

Efficiency risk (over-compliance): In the case of over compliance a loss of productivity can be caused if the operating expense for the sustainment of the quality system is too high and consumes a major part of the resources.
Otherwise the overstated requirements can not be realized completely by the personnel and cause a demotivation of the personnel, leading factually to the same consequences as non-compliance. Reasons for over-compliance can be:

• Requirements from authority or customer audits
• Recommendations of consultants
• High necessity for security
• Systems that have grown over years
• Integration into corporate quality assurance
• Compliance to several co-existing QM systems (e.g. ISO, GxP)
• Misinterpretation of regulatory requirements

It is our objective to lead you to the optimal compliance domain.