Non-quality and failure costs | Dutch IT channel

In the high-tech world of aerospace, quality is normal. Ultimate quality because you can’t just park a spaceship or plane on the hard shoulder if something goes wrong. But if 99.9% or more of your design, finished product and process is documented quality, how can you detect, analyze and improve deviations from this quality? How do you find the tight spots where something could go wrong? How should you search, how can you recognize it? It often helps to look for the opposite or ‘the double’. For quality, this results in the concept of ‘non-quality’. How do I find the rare non-quality in the ocean of quality: the possible serious cause of serious errors, mistakes, derailments or even serious and fatal accidents?

Duality

Duality is a familiar concept in my old field of electrical engineering. You have voltage versus current, resistance versus conduction, capacitance versus inductance, short circuit versus open circuit. In short, something is dual if it fulfills two fundamentally incompatible and/or opposing principles. If one is so big that you can hardly measure anything on it, look at the small inverse, which you can often ‘spot’ and measure much better.

The cost of non-quality is the cost of making mistakes through wrong designs, processes and management, wasted time, wasted money and wasted opportunities. Quantitatively, the mistakes made are multiplied by the repair costs plus allowances for fixed costs, overtime, loss of material, loss of image, intangible costs and any suffering. That is why it is so important to find, recognize and eliminate non-quality. Even if the rest is already 100% quality.

Small problem has a big impact

Understandably, a lack of quality can have major consequences. A faulty bolt among the millions of other perfect parts – such as in the Bijlmer disaster – can cause a plane to crash. A wrong software rule can kill hundreds of people, as with the 737-MAX. A small part of the unemployment benefit law can – unintentionally in advance – result in many unwanted victims. The Environment Act, which according to experts had to go back to the draft much earlier, remains a difficult exercise so far.

That is why the concept of non-quality is so important in quality assurance. One small, petty assumption, assumption, or error of thought—no matter how well designed and crafted everything else is—ruins everything, or worse: creates far more harm than all the good does. A frustration for everyone in the executive organization who did and is doing the right thing. . . Despite all the good manuals, work instructions, intentions and extremely committed employees.

You don’t know what you don’t know

Every serious chief designer and program manager is aware of everything he or she doesn’t know (yet). Where unknown non-quality may be present. Problems that are there but you don’t know (yet) because you don’t know what you don’t know. The unknown can ultimately cause a great product to fail completely. The harsh reality of large and strategic projects. Unfortunately, we have many examples of this, not only in the business world, but also in the national government. And which could have been avoided with further analysis.

Not realizing that he or she may not know something can lead to arrogance. “We have everything under control and make no mistakes. We can’t imagine what mistakes we could make.” What you know and think you know affects your thinking. Logically speaking. But what you don’t know affects your thinking just as much: it can lead to self-confidence, arrogance, unconscious mistakes and missing opportunities. The illusion of wholeness hinders us: for example, the belief that your organization is as you see it. Or the belief that your product is perfect until suddenly an unknown problem arises and your product or process shows serious problems. You can usually recognize real leaders and experts by the fact that they are not ashamed to have doubts and express them.

In my blog ‘White swans, black swans’ I quote the book by Nassim Nicholas Taleb: ‘The impact of the highly improbable’. For more than 1500 years it was believed that all swans are white because no one had ever seen a black swan. The existence of black swans was therefore seen as an impossibility. Until the Dutch explorer Willem de Vlamingh discovered a black swan in Australia in 1697 and turned this certainty on its head. Taleb argues that Black Swans increasingly shape our history because of the increasing complexity of society.

Error costs

Due to the integration and digitization of systems, the potential cost of failure – if something really goes wrong – increases enormously due to the chain operation. And a small mistake leads to a consequence with even greater consequences and accidents. An unexpected positive feedback in a system ‘suddenly’ makes it so unstable that it derails. Joseph M. Juran – one of the founders of contemporary quality thinking – met with great opposition in the United States when he stated that top and middle management needed quality training. In Japan, however, he was welcomed with open arms, and he became famous for the dominant Japanese quality thinking.

Famous elements of his thinking are the definition of quality balance ‘fitness for use’ and the associated quality model for this: meeting customer expectations (customer satisfaction) and reducing the costs associated with not delivering quality (non-quality). If the (social) costs of non-quality are greater than the benefits of positive quality, your product will not be successful.

Juran divides the effort to deliver ‘overall quality’ into prevention costs, assessment costs and – last but not least – failure costs: the costs of eliminating quality deviations. It is precisely these failure costs that can destroy all good things. Not only in the results, but especially in the perception of the customer, user or citizen. It is the expression: ‘a good name comes on foot and goes on horseback’. Small mistakes that ultimately have big consequences destroy any reputation; regardless of how well the rest worked.

A good design is therefore worth its weight in gold

In the initial design phase of a product or application, almost 100% of the final life cycle cost of that product or application is determined. Including the potential costs of failure. The commitment of 0.8%, 1% or 1.2% of the total lifetime cost of a good integrated design of the product or service in question can make the difference between the final price of a good product (100), a mediocre product (150 ) or a defective product (5000+).

The most successful products were conceived by a small group of designers, architects and engineers and made robust, ‘resilient’ and ‘fail-safe’ already in the design phase. Also see my previous blog ‘Failure safe systems: how ICT can learn from aeronautical engineering’. It is therefore more than worth it as a customer (desired features and yield/results) and designers (translating features into feasible systems) to invest a little more in the first phase. And with the ‘minimal’ extra effort, we can not only improve the product quality in a sustainable way, but most and above all reduce the future failure costs enormously.

By: Hans Timmerman (photo), Chief Data Officer at DigiCorp Labs and Director of Fortierra

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