The Quality Assurance (QA) department is roughly a bunch of testers debunking your app(s) all day, giving the green light for releases, handling Alpha / Beta programs. And much more.
But without a QA department in a software company, issues arises too often in the field, and problems costs more to fix. However, most companies starts in a garage, with 1 employee being yourself, and then grows into a software company.
When do you tell it's to create such department ? Anything to do with the size of the company, the problems it encounters ?
As soon as you can afford it. You will never have a product which will be as reliable without a qa department than with one. Programmers don't make good QA people, and it is always better to have a second person (or more) reviewing how the app works.
All good software companies, and organizations with a good IT departments which create programs have a qa team. It's vital to software development.
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