Management And Accounting Web

Gabel, N. 1991. Is 99.9% good enough? Training Magazine (March).

Summary by James R. Martin, Ph.D., CMA
Professor Emeritus, University of South Florida

Deming Main Page | Quality Related Main Page

Is an acceptable level of conformance quality good enough? For example, what would it mean if organizations achieved 99.9% quality? The author provides several examples based on 1991 data. A few examples appear below.

Two million documents would have been lost at the IRS.

22,000 checks would have been deducted from the wrong bank accounts per hour.

12 babies would have been given to the wrong parents each day (4,380 during 1991).

268,500 defective tires would have been shipped during the year.

103,260 tax returns would have been processed incorrectly.

5,517,200 cases of soft drinks produced during the year would have been flat.

Two plane landings would have been unsafe at O'Hare International airport per day.

291 pacemaker operations would have been performed incorrectly during the year.

20,000 incorrect drug prescriptions would have been written during the year.

107 incorrect medical procedures would be performed per day.

According to Gabel, an acceptable level of quality is a trap or form of corporate quicksand.

_________________________________________

Related summaries:

Albright, T. L. and H. Roth. 1992. The measurement of quality costs: An alternative paradigm. Accounting Horizons (June): 15-27. (Summary).

Albright, T. L. and H. Roth. 1993. Controlling quality on a multidimensional level. Journal of Cost Management (Spring): 29-37. (Summary).

Albright, T. L. and H. P. Roth. 1994. Managing quality through the quality loss function. Journal of Cost Management (Winter): 20-37. (Summary).

Anderson, S. W. and K. Sedatole. 1998. Designing quality into products: The use of accounting data in new product development. Accounting Horizons (September): 213-233. (Summary).

Carr, L. P. 1995. How Xerox sustains the cost of quality. Management Accounting (August): 26-32. (Summary).

Carr, L. P. and L. A. Ponemon. 1994. The behavior of quality costs: Clarifying the confusion. Journal of Cost Management (Summer): 26-34. (Summary).

Deming, W. E. 1993. The New Economics for Industry For Industry, Government & Education. Cambridge: Massachusetts Institute of Technology Center for Advanced Engineering Study. Chapter 10. (Summary).

Fargher, N. and D. Morse 1998. Quality costs: Planning the trade-off between prevention and appraisal activities. Journal of Cost Management (January/February): 14-22. (Summary).

Hughes, S. B. and D. M. Willis. 1995. How quality control concepts can reduce environmental expenditures. Journal of Cost Management (Summer): 15-19. (Summary).

Kettering, R. C. 2001. Accounting for quality with nonfinancial measures: A simple no-cost program for the small company. Management Accounting Quarterly (Spring): 14-19. (Summary).

Kim, M. W. and W. M. Liao. 1994. Estimating hidden quality costs with quality loss functions. Accounting Horizons (March): 8-18. (Summary).

Lucier, G. T. and S. Seshadri. 2001. GE takes six sigma beyond the bottom line. Strategic Finance (May): 40-46. (Summary).

Martin, J. R. Not dated. Summary of the 1992 PBS Program Quality or Else. Management And Accounting Web. http://maaw.info/QualityOrElse.htm

Morse, W. J. 1983. Measuring quality costs. Cost and Management (July-August): 16-20. (Summary).

Pasewark, W.R. 1991. The evolution of quality control costs in U.S. manufacturing. Journal of Cost Management (Spring): 46-52. (Summary).

Roehm, H. A., D. Klein and J. F. Castellano. 1995. Blending quality theories for continuous improvement. Management Accounting (February): 26-32. (Summary).

Roth, H. P. and T. L. Albright. 1994. What are the costs of variability? Management Accounting (June): 51- 55. (Summary).

Rust, K. G. 1995. Measuring the costs of quality. Management Accounting (August): 33-37. (Summary).

Sedatole, K. L. 2003. The effect of measurement alternatives on a nonfinancial quality measure's forward-looking properties. The Accounting Review (April): 555-580. (Summary) and (JSTOR link).

Shank, J. K. and V. Govindarajan. 1994. Measuring the "cost of quality": A strategic cost management perspective. Journal of Cost Management (Summer): 5-17. (Summary).

Sjoblom, L. M. 1998. Financial information and quality management - Is there a role for accountants? Accounting Horizons (December): 363-373. (Summary).

Taguchi, G. and D. Clausing. 1990. Robust quality. Harvard Business Review (January-February): 67-75. (Summary).