Cost of Poor Quality (CoPQ). In the area of quality management, the CoPQ has been estimated to run 20-40% of the total budget. An organization that supports transparency and a commitment to improvement can with time, get the CoPQ down to the 5-15% range. There is a correlation between the CoPQ and the CMM Level. I would assess Brown County at a Level 2 on a 5 point scale.
A Level 2 means “It works – Good Enough”
Version 1.0 — Community and Capability Maturity Model (CMM)
The CMM provides a method for assessing change and improvement. An assessment is rated on a scale that ranges from 1.0 (low) to 5.0 (high). Most traditionally managed organizations (Brown County) are assessed at a level 2.0.
The concept for a Capability Maturity Model (CMM) was funded by the Department of Defense in 1986 to improve the quality of processes used to develop computer software. The model has since been expanded by the private sector to support continual improvement in a wide variety of areas to include: organizations and functions within organizations such as personnel, quality, finance, strategy, and risk management to name a few.
- “The term “maturity” relates to the degree of formality and optimization of processes, from ad hoc practices, to formally defined steps, to managed result metrics, to active optimization of the processes.” – Wikipedia
A supporting initiative at the Federal and State level to assure the effective and efficient use of taxpayer money is referred to as the management of Internal Controls. The State of Indiana – Uniform Internal Control Standards for Indiana Political Subdivisions describes internal controls as follows:
- By necessity, the definition of internal control is broad. Internal control is a
conceptual process that is applied to a wide range of situations in a wide
range of environments. The purpose of the internal control process is to
provide reasonable assurance that the mission and objectives of an
organization will be achieved. This purpose includes the reduction of risk
associated with fraud as well as a safeguard of resources against loss due
to waste, abuse, mismanagement, or errors. Internal control provides a
check and balance system over operations, promoting operational
effectiveness and efficiency. A system of sufficient internal control
produces reliable financial and management data; ensures accuracy and
timeliness in reporting, and promotes compliance with laws.
