When the Pursuit of Quality Destroys Value

Quality has been hailed by software engineers as the solution to many of the most urgent challenges facing our industry in the 1990s, ranging from technical concerns – such as safety and reliability – to strategic concerns – such as market share, customer satisfaction, and economic profit. Today, our industry is adopting the ISO 9000 quality framework with the same enthusiasm we showed for Total Quality Management in the 1980s. Yet consider this: Paul Taylor and international management consulting firm A.T. Kearney recently estimated that less than 20 percent of the companies that implemented TQM programs reported any financial improvement (“Such an Elusive Quality,” Financial Times, Feb. 14, 1992). How can this be? Surely, the relentless pursuit of quality can dramatically improve the technical characteristics of a software product or service. In some applications – medical instruments air-navigation systems, and many defense-related systems – the need to provide a certain level of quality is beyond debate. But is quality really a framework for strategic decision making in the broader, commercial marketplace? Many contributors to this column have argued that, as our industry matures and becomes ever more central to a company’s business, software engineers must become familiar with many viewpoints. For example, Suzanne Robertson took a systems perspective (“Visibility: The Key to Quality Improvement,” July 1995, pp. 95-97). Here I will shift the perspective to that of the corporate strategic analyst. When you take this view, I think you will be surprised to discover how tenuous the linkage between quality, competitive position, and profit can be.