The main reason why testing is so important is to reduce the impact of any losses that could arise if the product fails to meet certain requirements.
In the 'Quality Mission' section, the types of losses that organisations could experience were highlighted.
These losses can be substantially reduced by utilising quality improvement methods such as testing.
In this section the potential losses are examined again, along with examples and an insight into how testing could have reduced the losses.
Organisations are under intense pressure by their owners and shareholders to consistently produce more and more profits. Any reduction in profit will simply not be tolerated. To increase profits, an organisation must increase its revenue and reduce its costs.
If a product fails to meet expectations of the market then this product will not produce revenue as anticipated and the costs of remedying will increase, leading to a drop in potential profit.
The further in the products lifecycle that a defect is detected, the higher the cost of rectifying it. So whilst a defect detected during the development of the product may be rectified at little cost.
Defects later such as during the products use, will cost much more to rectify as they will involve expensive product recalls.
LOSS: Poor car sales due to unreliable and poor quality vehicles.
Many British car manufacturers have fallen by the wayside because they have failed to meet the expectations of the buying public, to whom quality and reliability have become an important factor in their purchasing decisions.
Poorly designed and built cars have not sold in the numbers required for profitability. Leaving little or no money available to invest into quality improvement and newer models.
REMEDY: Better testing of the vehicles could have increased reliability. Further testing of whether the vehicle designs were acceptable by the buying public could have helped develop profitable cars that people really wanted.
LOSS: Costly product recalls of faulty products.
Many manufactures have fallen foul of product recalls which have severely dented profitability. A chocolate manufacturer incurred costs in excess of $30 million having to recall millions of chocolate bars due to a fault in their production.
A laptop manufacturer found that the batteries they used could overheat and explode. The recall involved several million laptops.
A major car manufacturer had to spend over $2 billion to recall vehicles with suspect tyres that allegedly had the tread peel from the tyres causing blow-outs in hot conditions or during high-speed driving. There had been many deaths reported due to the alleged defect in the tyres.
REMEDY: More thorough testing could have isolated these problems in the products development stage, where the cost of rectifying any defects would have been marginal compared to the cost of having to recall millions of products later.