In this video presented at the 20th Annual Audit Division Conference by ASQ, the organization delves into the real costs of poor quality: devastating environmental damage and the loss of human life. Let's take a closer look at the three notorious poor quality examples cited in this Cost of Poor Quality video.
1) The 1986 Challenger Explosion
On January 28, 1986, the NASA Shuttle Challenger exploded shortly after launch, destroying the vehicle and all crew members. The destruction of the Shuttle was caused by the hardware failure of a solid rocket booster (SRB) "O" ring.
The subcontractor responsible for the development of the SRB "O" rings, Thiokol, provided information to NASA the day before launch concerning the cold temperature's affects on their provided "O" rings used to manufacture the shuttle. The supplier, having done their own production quality control analysis of their product, recommended not to launch: but due to a prior rescheduling of the mission, cancellation was not an option to NASA. (Source: The Space Shuttle Challenger Disaster, by Jeff Forrest. Photos courtesy of NASA.)
In addition to these failures, NASA failed to adhere to the quality principles of having a mutually beneficial supplier relationship, and ensuring that their suppliers are able to deliver optimal results. They also broke the quality rule of taking a fact-based approach to decision making, and as a result 7 astronauts lost their lives.
2) The 2009 Toyota 9 Million Car Recall
Toyota Motor Corp. recalled approximately 9 million vehicles in the United States, which was the company’s largest-ever U.S. recall. The purpose of the recall was to address quality assurance and quality control problems with a removable floor mat that could cause accelerators to get stuck and potentially lead to a crash. (Source: Toyota recalls 3.8 million vehicles, MSNBC.com)
Toyota, which up until that point prided itself on its quality practices, had made the decision in the 1990's to put a greater emphasis on growth. They failed to adhere to the quality principle of employee involvement, as there was less employee engagement and sharing of best practices. While the CEO was proactive about cancelling the sales and productions of the recalled models, 52 people lost their lives as a result of motor vehicle crashes.
3) The 2010 BP Deepwater Rig Explosion
After much corporate quality failure finger pointing, this oil rig explosion was and still is the greatest manmade environmental distaster of US History. The explosion aboard the Deepwater Horizon rig on April 20th, 2010 killed 11 onboard workers and began a devastating spill which leaked over 4 million barrels of oil into the Gulf of Mexico – which is still to date the largest American spill. The leak took three months, and a huge variety of different attempts to seal before BP finally closed it off on July 15th, 2010. (Source: The Guardian Environment Blog, by Richard Adams and Adam Gabbatt)
The quality management failure for this situation was weak cement around the well. Contractors failed to properly test the cement in order to to save time and money. Technicians also incorrectly interpreted a fluid pressure test, and ignored warning signs.
There was much finger pointing between the three corporations involved: BP was blamed for their flawed well design, Transocean was blamed as owners of the rig, and Halliburton was blamed as the contractor providing botched cement used to create the well. The U.S. Government, who blamed them all, was also blamed for lack of regulations.
The disaster cost the company lost $10 billion, 11 people lost their lives, and the environmental damage was inestimable. It only would have taken 10 hours to check the cement, at a preventative cost of $128,000.
Each of these companies broke the central rule of quality, which regards the customer based organization: which is to understand your internal and external customer needs, and strive to exceed them. These organizations were concerned with deadlines, costs, growth, and other considerations not relating to their customers or quality assurance management. When you lose sight of what matters most in your business - the customers and their safety - the cost of quality can be too high to ignore. (Article Source: Cost of Poor Quality Video Presented at the ASQ 20th Annual Audit Division Conference)
What do you think about these disasters? Are there any additional significant incidents you would add as being important examples of quality failures? Let us know in the comments!
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