24th November, 2014
A study was conducted by the SEI (now CMMI Institute) on the metrics data collected from 35 large organizations across the world. These organizations having low as well as high maturity apply CMMI Process Improvement practices to their Software Engineering, System Engineering and other Engineering activities.
For example controlling the Cost of Poor Quality (COPQ), an organization named ABB calculated the Cost of Poor Quality (COPQ) by calculating the Defects of Integration and System Testing and tracking time for defect corrections and retesting. As we all know that fixing defects at the stage of System and Integration Testing phase is more costly than earlier phases.
After a year of CMMI Process Implementation it was observed that there was a reduction of 30% in the cost of poor quality. It was also calculated that the Return on Investment (ROI) on major process changes was 3:1 to 5:1 (benefit to cost of process improvement activities) and the organization had a net economic benefit of 50 percent.
This shows that CMMI Process Implementation can lead to reduced cost of poor quality and good return on investment over a longer period of time of implementation.
For controlling the Cost of Poor Quality (COPQ), an organization named ABB calculated the Cost of Poor Quality (COPQ) by calculating the Defects of Integration and System Testing and tracking time for defect corrections and retesting. As we all know that fixing defects at the stage of System and Integration Testing phase is more costly than earlier phases.
After a year of CMMI Process Implementation it was observed that there was a reduction of 30% in the cost of poor quality. It was also calculated that the Return on Investment (ROI) on major process changes was 3:1 to 5:1 (benefit to cost of process improvement activities) and the organization had a net economic benefit of 50 percent.
This shows that CMMI Process Implementation can lead to reduced cost of poor quality and good return on investment over a longer period of time of implementation.
Source: Performance Results of CMMI®-Based Process Improvement Report.
Published by CMMI Consultant
cmmi consultant, cmmi consultants, cmmi consulting, cost of poor quality
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Rajendra is a qualified and certified Lead Appraiser and Instructor for the following :
Rajendra is Lead Assessor for ISO 9001 (QMS), ISO 14001 (EMS), OHSAS 18001 (OHSMS) since 1994
International Automotive Task Force (IATF) approved Lead Assessor for Automotive Standard TS 16949:2009
Lead Assessor for ISO 27001 (ISMS) and ISO 20000-1 (ITSM)
Rajendra has 25 years experience in the industry.