CPIM Practice Exam

Internal failure costs are primarily concerned with:

1. Problems encountered post-sale

2. Deficiencies found during production

3. Customer satisfaction metrics

4. Product development timelines

The correct answer is: Deficiencies found during production

Internal failure costs focus on deficiencies identified during the production process before the product is delivered to the customer. These costs arise when a product fails to meet quality standards or specifications while still in the manufacturing phase. By addressing issues internally, organizations can reduce waste, rework, and scrap, ultimately improving efficiency and product quality. This proactive approach is crucial for maintaining operational effectiveness and minimizing the impact of defects that could later lead to more costly external failures, such as warranty claims or returns. In contrast, concerns related to problems encountered post-sale, customer satisfaction metrics, and product development timelines revolve around external factors and outcomes that occur after production, which are not classified as internal failure costs.