2. Project Charter
• To find ways to improve the development and
release of XFS base software.
• To measure the cost of poor quality ATM
software.
• To measure, analysis, improve and control the
delivery and implementation of ATM software.
3. Cost of poor quality
• A recent study of 4 defects for one of our major
customers showed that to correct these defects was 3
millions dollars for an average of $750,000 per defect.
• At a average of a little over 20 defects per month.
These defects for this one customer cost a total of 183
million dollars. Even if you calculate that the cost for
these defects is highly skewed by 80% the cost for this
one customer is still 36.6 million dollars. This
customer represents. About 20% of ATM in the US so
we are looking at a total cost of over 183 million dollars
per year.
7. Analysis of Data
• Chi-Squared test shows the expected data
does not fit the observe data. This means that
even though the control chart shows a process
in control it is not in control.
• Goal is to reduce defects by 75%. Reduce the
average defects by an average of 20 to an
average of 5
• This will save $137,250,00 per year.
8. Improve Process
• Increase a system test on top 20% of integration
system before base software is released. This should
reduce defects by 50%. We can pass this cost on to the
customer by reducing the trips to ATM and downtime.
• Increase communication by users and developers by
having user groups 3-4 times a year. This should
reduce defects 10%
• Conduct a monthly defect meeting. XFS developers
and integrators can communicate fixes. This can be a
SharePoint site. This should reduce defects by 15%.
10. Total Annual Savings
Total cost of defects $183,000,000.00
Total savings $137,250,000.00
Cost of defects after changes $45,750,000.00
Cost on changes 2,500,000.00
Total Annual savings $134,750,000.00
