I have always been what you may call an “overthinker” (yes, I do have a t-shirt that states this). I like to say I simply see the value of a well-planned plan.
When I was introduced to the 1-10-100 Rule in a training session about best practices in quality assurances – I very quickly related this rule to improving any project that I work on from work to home and was reminded of the value in my sometimes-overthinking ways.
What is the 1-10-100 Rule?
The 1-10-100 rule can be applied in many scenarios concerned with quality and the cost of the correction. It is expressed in dollars but it can be understood to mean any number of ‘units’, measured in financial terms. We can also use 1-10-100 to measure ‘cost’ in terms of resources and time.
The instructor in our course said it this way –
It costs $1 for an issue to be discovered when the product/project is being planned.
It costs $10 to correct the issue once the product/project reached production and the issue is discovered during testing – the increase in costs is due to people’s time, materials used and resources.
If at the end of a project or when a product is completed issues are still found – those cost $100.
BUT if the final product reaches customers, those costs can grow to be $1,000 or more.
This is used to illustrate error costs for many different industries from consumer goods/services to software and app development…How does this relate to other work day-to-day projects or even projects you have at home?
When projects are being scoped or planned, there are often technical and logistical aspects to be considered that can save time and money. These can also become a liability if not planned and scoped correctly and according to the client’s, consumer’s or your family’s expectations.
When a project that has complex setups (large number of versions, different vendors or clients involved ect.) or a new completely new idea is in the planning/quoting phase – this is the best time to think of the details. Planning early allows you and your team or vendors to determine how to best setup the project, what the requirements of time and resources would be, where there may be gaps in the plan and what business rules will need to be determined for the project to run smoothly while keeping the costs and time as low as possible.
Here’s an example for using this rule during a home renovation project:
- You find a simple measuring error in the initial quote that a home improvement store provided you for flooring before any flooring is ordered. The error if caught now will not cost anything to correct so this is the $1 error.
- The same measuring error is not caught in the quote, you order the flooring. The error is found when the contractor comes to your home to lay the flooring and you must return to the store to place another order. At this point in your renovation project having no flooring is pushing your entire project back. The increase in costs is due to people’s time and resources. This is the $10 error.
- If the same error occurs but this time it’s not discovered until the contractor has begun laying the floor and he runs out of flooring. The error costs increase again due to time and resources, you also now have to pay for the contractor to return another day, you run the risk that the flooring tiles will not look the same when they are completed and you are pushing your renovation schedule out waiting on the new tiles. These costs are our $100 error.
- If the contractor completes the job, cutting corners along the way to accommodate the shortage of tiles you ordered and assuming you’d be okay with no tiles under your cabinets or appliances. You arrive home to see what he’s done. This error would be our $1,000 or more.
As you see each step of the way errors or mis planning increases the project costs and the time it can take showing the real value in planning and quality control measures at all phases of a project.