Quality Loss Function in Software

The concept of Quality Loss Function is a central tenet of Taguchi Methods. As discussed in Chapter 2, Taguchi argues around "loss of quality" rather than quality itself, and the implications of such loss to the customer, producer, and society at large. Quality loss is defined as "loss imparted by the product to society from the time the product is shipped." This includes the following:

• Loss to the company through the costs of preventive, appraisal, and various internal and external software failure and debugging activities

• Costs to the customer through poor software product performance and reliability

• Further losses to the company if it loses customers as a result of poor product performance

• Probable losses to society if the software causes cost, crime, safety, security, health, or environmental hazards to society at large

Taking a best-possible target value for the quality characteristic, Taguchi associates a simple quadratic loss function with deviations from the target value. QLF shows that a reduction in variability about the target leads to a disproportionate decrease in various losses and a subsequent increase in quality. This function is used for design decisions on financial implications of quality investments to decide whether additional costs of improved quality will actually prove to be worthwhile in the marketplace. The important difference between the traditional approach and Taguchi's approach is that in Taguchi Methods, the product quality is determined by lack of variability from the target value as opposed to quality acceptance within specifications (see Figures 2.3, 2.4, and 2.5 in Chapter 2).

QLF, along with the signal-to-noise ratio, constitutes one of the two measures of quality in Taguchi Methods. It helps you make a sound financial decision on improved performance that comes from tighter tolerance. QLF is discussed further in Chapters 16 and 17.