Quality Progress - October 2014 - 8
Weighing cost of quality
egory (external failure costs), and economic
without a library of manuals, process areas
Q: In agile systems development pursuits, are
models show it may be more cost effective
and artifacts. They eliminate most manual
the appraisal and failure costs of a greater
to recall a product than to "do it right the
processes by running automated tests at a
magnitude or proportion of the overall cost
first time," as W. Edwards Deming suggested.
fraction of traditional CoQ and don't require
of quality (CoQ) than in nonagile pursuits?
Proponents of traditional methods like to
years of expensive training. Done right, they
In agile development pursuits, what are the
point out that academic textbook approach-
eliminate debilitating big-bang organizational
preferred proportions of prevention costs vs.
es emphasize the use of a balanced portfolio
change. They are lean, just-in-time, have low
appraisal costs vs. failure costs relative to
of quality engineering activities. In fact, tra-
work in progress, focus on high-priority cus-
the overall cost of quality?
ditionalists tend to point to the earliest and
tomer needs and can be used to meet scope,
lowest-cost defect prevention activities as
time and cost constraints.
Wallace J. Robinson
the answer to the quality dilemma. Unfortu-
Even novices using agile methods experi-
nately, instituting these practices is difficult,
ence great improvement in terms of time,
A: It's been known since the founding of
expensive and time consuming. Traditional
cost, quality, risk reduction and customer
scrum and extreme programming-later
methods come with portfolios of thousand-
satisfaction. The rewards are greater if you
called "agile methods"-that these methods
page models recommending hundreds of
invest more time implementing most agile
have a lower CoQ.
activities, metrics and artifacts.
practices. Projects that use more of these
In simplest terms, CoQ is the total costs
Agile methods aren't as well entrenched,
agile practices experience 100 to 200 times
of achieving conformance to requirements
don't come with dozens of thousand-page
the level of productivity and quality improve-
for a product or service across its entire life
manuals, and have few activities and artifacts.
ment typically found by using traditional
cycle (from concept to retirement). There
Their creators understood why traditional
methods. Employee morale increases, ex-
are generally four major quality engineering
projects failed and incorporated practices to
pensive attrition comes to a screeching halt,
activity expenses that contribute to CoQ:
overcome these problems. Agile methods
and customer satisfaction, trust, loyalty and
dramatically reduce scope and sharply align
retention exponentially increase, along with
ing defect introduction before development
it with business objectives. They develop a
buyer and supplier business value.
(training and root cause analysis).
small, highly prioritized list of the top 20%
Remember that it is possible to fail with
of customer needs to achieve 80% of the
agile methods. Ignoring advanced practices
dently evaluating products and services
business value. They're implemented in small
and principles such as fully automated test-
before delivery (inspections and testing).
batches until tacit knowledge is uncovered.
ing, continuous integration and continuous
Buyers and suppliers communicate, cooper-
delivery is the fastest way to fail. Remember
fixing defective products and services before
ate and collaborate in an open, empowered
that agile methods are a mindset, value sys-
delivery (rework, retesting and scrap).
and transparent manner using lightweight,
tem and set of behaviors similar to Deming's
disciplined processes and artifacts. Thou-
1. Prevention costs: the cost of prevent-
2. Appraisal costs: the cost of indepen-
3. Internal failure costs: the cost of
4. External failure costs: the cost of
fixing defective products and services after
sands of automated tests are run every few
delivery (warranty, repair and recall).
minutes using free and open-source tools.
plans, daily standups, demonstrations and
Frequent defect prevention is performed on a
retrospectives instead of advanced agile
daily, weekly and monthly basis.
principles is also a quick way to fail. You can
The expenses associated with each type
of cost grow in order of magnitude from
stage to stage. For instance, prevention
Sticking to basic backlogs, iteration
Visit this article's webpage at www.
also revert to debilitating traditionalism be-
costs $1 per defect. Then, appraisal costs
qualityprogress.com to learn 18 practices
cause you don't know how to get coaching
$10 per defect, internal failure costs $100
that help make agile CoQ lower than
to achieve productivity and quality levels at
per defect and external failure costs $1,000
150 times the level of traditional methods at
per defect. External failure costs may be as
high as $10,000-$50,000 per defect.
Today, some firms focus on the last cat-
QP * www.qualityprogress.com
Agile methods have few down sides. They
have the repeatability, definition, quantification and optimization of traditional methods
a fraction of the CoQ.
Agile methods consist of a plethora of sophisticated human behaviors as opposed to
Table of Contents for the Digital Edition of Quality Progress - October 2014
Mr. Pareto Head
Step It Up
Strength in Numbers
Take Care of Your ‘Ugly Baby‘
Getting It Right the First Time
Quality in the First Person
ASQ's Quality Resource Guide
Back to Basics
Quality Progress - October 2014