Failing systems cost money! Everybody knows that! But do they know how much money it costs? We can calculate how much money it costs to solve the problem in production; and that is a lot more then when the fault (defect at that moment in time) was solved in an earlier phase (see Boehm from 1979). But what is the cost of quality (CoQ) of failing systems except besides repairs?

We all know the situation that critical systems can fail. This can be very critical when it’s a bank. Especially when there are some failures during one month in the banks online banking application/website. As a result its clients could not reach the site, for days the system was unavailable. This is a big issue in these ‘online’ times as most transactions on accounts are now online. Of course these errors needed to be fixed an a few days later the system was online again.

But what is the ‘pain’ in this? People couldn’t get to their money! The local online payment system didn’t work for this bank! Salaries couldn’t be transferred! Bills couldn’t get paid! Even mortgages could be left unpaid!

Note: It would be interesting to know when a mortgage could not get paid because of a lack of funding; the salary wasn’t transferred by the employer, the system was unavailable, if the bank would demand a fine for a late payment.

So the bank even had a lack of income because of their own failure. And now web shops are making claims of missed sales volume because the online payment system was out. They’ve calculated that they generate 9 billion Euros in a year, so every day the system is out will cost them almost 25 million Euros.

Note: This claim will not stick in court, but it’s an interesting subject.

So the failing software of one bank costs 25 million on top of the repair costs. Money they could have spent better. Add to this the image damage and the cost of people running away to another bank. Would you do that if you couldn’t access your money for days?

And I’m not going to say the software wasn’t tested well enough. I wasn’t there so who am I to say that. But what I can say that maybe the risks weren’t assessed correctly. If somebody would have known that such an error would have generated that amount of damage. But who know this?

People do not know, or do not share, the costs of a failure in Production. We all know the repair costs, but not what the damages are. Maybe we should know them to assess the risks better. And maybe someone would have thought of testing the cause of the failure…

Question
Do you have any idea or examples you would like to share with us (and others) on helping in getting more insight in this issue? Are you looking into this or not?

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