Economic framework of data quality and the value proposition

This chapter develops a framework for establishing the value proposition basis of a data quality improvement process. The thrust is that there are real economic impacts of data quality problems, the first step in addressing these problems is to build a data quality scorecard that evaluates the cost of low data quality (COLDQ). The factors that indicate the existence of an economic impact, include frequent system failures, service interruptions, high employee turnover, customer attrition, and increased customer service requirements. Using these indicators, the economic model can be build. The model itself consists of an information chain describing the flow of data throughout a system, which is later attributed with details about potential sources of data quality problems. An information chain consists of a set of processing stages connected by information channels. This building block allows both operational data flows and strategic data flows.