Business Case/ROI Considerations
Calculations of all of the costs above are critical to forming a business case for implementation of a repair quality control program. No business would willingly implement any program that did not promise a return for the investment required. In this case, return on investment (ROI) will equal a combination of cost savings and revenue improvement via a reduction in rework. (See Fig 1
Determining what is an acceptable return is not within the scope of this RP. There are many accepted ways to calculate financial return, and service providers use the method that suits them best. All service providers also determine what level of return is acceptable for their operations. The point here is that ROI must be calculated to determine if it is acceptable to the service provider.