The real cost of poor quality

Four billion working hours are wasted on mistakes each year in the UK. Only 22 per cent of employees believe that their organisations deliver what customers want every time. 38 per cent of employees think their organizations do not measure the cost of mistakes. These are some of the findings of a YouGov survey undertaken jointly by the Chartered Quality Institute (CQI) and the British Quality Foundation (BQF).

Both the CQI and the BQF are of the view that organisations are missing a massive opportunity to improve their business processes, eliminate waste and improve customer service. The purpose of the survey, which sampled more than 2,500 employees from a range of sectors, was to explore and quantify the opportunity.

Joe Goasdoué, BQF CEO, says of the results: ‘The current economic climate is putting pressure on every company to streamline costs and procedures. What this survey shows is that companies are failing to help themselves in these difficult times by not having systems in place to measure, tackle and repair the costs of errors in their business.

‘Business improvement should be a priority whatever the economic climate and UK businesses clearly need to do more to ensure that they are operating as efficiently as possible.’

Simon Feary, CEO of the CQI agrees, adding: ‘Many UK businesses are missing a trick – the first place to look for cost savings is in eliminating waste and increasing efficiency. Cutting investment in people, advertising and so on must surely come afterwards. However, with the speed of the downturn I am concerned that those organisations that do not already have quality systems in place will be those least ready to react and therefore most at risk of going under.’

Key results of the survey include that more than half of the employees spoken to believe they waste up to ten per cent of their day correcting mistakes and redoing work. This equates to up to 3.98 billion hours each year that UK workers are wasting on rectifying errors. Less rework was reported among those with a performance measurement and improvement system.

However, two in five employees said their organization did not have, or they were unaware of, a system in place to measure and improve how efficiently they were performing at work. Those with a performance measurement and improvement system were significantly more likely to feel that their employer’s business processes are joined up and constantly improved.

For more information visit www.thecqi.org