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The Costs of Poor Quality Information, evidenced by the process failure, recovery
from the process failure, and the ensuing Information Scrap and Rework estab-
lishes the business case for investing in Total Information Quality Management
(TIQM).When you measure the extent of missing, inaccurate, untimely, or dupli-
cate data, it is not the number of defects but the costs and consequences of those
defects on process failure and Customer alienation that are important.
This chapter describes how to measure both the direct costs and the lost and
missed opportunity costs so that Executives and Change Sponsors can feel the
pain and costs of maintaining the status quo. This chapter further describes how
you can measure the Return on Investment (ROI) of your Process Improvements
(TIQM P4) described in the next chapter.
TIQM P3. Measure Poor Quality Information
Costs and Risks
Figure 6-1 illustrates the relationship between measuring the costs of poor
quality and the other TIQM processes.
By assessing Information Product Specification Quality (TIQM P1) and
Assessing Information Quality (TIQM P2), you establish the extent of IQ prob-
lems. By measuring the Costs of Poor Quality Information (TIQM P3), you
translate the extent of the IQ problems into the lost currency value, in terms
C h a p t e r
6
The Step-by-Step Guide to
Measuring Costs and Risks of
Poor Quality Information
“Quality is fr