What’s the ROI of Quality?

Currency in U.S. dollars.

Every $1 spent on a quality
management program returned:

$6
■■ in revenue

$16
■■ in cost reduction

ISO 9001 ROI

■■ $3 in profit
■■ 2010 Harvard Business School study of business
■■ Quality management reduces costs an average
of 4.8 percent
■■ 93 percent of organizations agree quality
management was significant driver of success
■■ 83 percent of organizations agree that without
quality management they could not justify their
pricing to customers 1
benefits for 916 adopters vs. 17,849 nonadopters:
−− Higher rates of survival, sales,
and employment growth
−− Increased wages
−− Reduction in waste generation
−− Enhanced worker productivity
and ability to pay closer attention to detail 4

Six Sigma ROI

$2 in direct
■■ Average return of more than
. June 2012 study by the
1
Center for Economic and
3. “The Impact of Baldrige on
Organizational Performance,”
savings for every $1 invested Business Research. From The Journal for Quality and
“Lasting Impression,” QP, Participation, April 2012,
■■ Average savings of 1.7 percent of revenues over
November 2012, asq.org/ http://rube.asq.org/quality-
implementation period 2 quality-progress/2012/11/ participation/2012/04/baldrige-
quality-management/lasting- national-quality-program/the-
impression.html impact-of-baldrige.pdf (survey
covered all applicants from
2. “Costs and Savings of Six
2006-2011)
Sigma Programs,” Quality
Management Journal, October . 2010 Harvard Business
4
2012, http://rube.asq.org/quality- School study comparing
management/2012/10/six-sigma/ 916 organizations that have
costs-and-savings.pdf adopted ISO 9001 and
17,849 nonadopters comes
Snee, R. D., and R. W. Hoerl, from “Standard Wise,” QP,
2004, Six Sigma Beyond the September 2013, asq.org/
ROI of Baldrige Performance Factory Floor: Deployment quality-progress/2013/09/
Excellence Program Strategies for Financial Services, standards/standard-wise.html
Health Care, and the Rest of the
■■ Data for three measures of program value showed Real Economy, Upper Saddle
benefits/cost ratio
combined River, NJ: FT Press
of 820:1 3