Cost of Inaction Model
A quality budget is argued for against other budgets, and it loses when it is described as an expense. This model converts what your site is already carrying — investigation hours, an ageing CAPA list, batches on hold — into an annual figure you can put beside a remediation cost. The method is visible in full; nothing is hidden in a black box.
€251,806
Cost your site absorbs over twelve months if nothing changes.
€755,419
Before any escalation is priced in.
€85,000
The proposal you are weighing it against.
3.0×
Twelve months of unaddressed cost is 3.0 times the remediation budget.
Your inputs
Where the cost sits
Updates as you type| Cost driver | Annual | Share |
|---|---|---|
| Deviation investigation labour120 deviations × 14 h × €75/h | €126,000 | 50% |
| Overdue CAPA carrying cost18 open × 95 days avg age | €17,100 | 7% |
| Capital tied up in held batches9 batches × 21 days × 8%/yr | €7,456 | 3% |
| Recurrence premium25% repeat rate, 1.5× rework factor | €47,250 | 19% |
| Inspection finding response3 findings × €18,000 response cost | €54,000 | 21% |
| Annual carrying cost | €251,806 | 100% |
How the annual figure is composed. Held-batch capital is charged at 8% per year on value × days held; the recurrence premium applies a 1.5× rework factor to the repeating share of investigations; finding response is modelled at €18,000 per finding for remediation, retraining and response drafting.
What this model is not. It does not predict a recall, a licence action, or any specific regulatory outcome, and it is not financial advice. It is an arithmetic of costs you are already paying, made visible. Every rate above is a default you should replace with your own — the argument only works with your numbers in it.
Review these numbers with usCost does not accumulate. It escalates.
If unresolved issues simply piled up at a constant rate, deferring would be a reasonable financing decision. They do not. An open deviation raises the chance of a repeat; a repeat raises the chance of an observation on QMS effectiveness; an observation converts a quality problem into a regulatory one with a fixed response deadline you no longer control.
| Stage | What it costs you | Who decides the timeline | Severity |
|---|---|---|---|
| Open deviation | Investigation hours | You | contained |
| Recurrence | The same investigation, twice | You | rising |
| Overdue CAPA | QA oversight, management attention | You, with pressure | rising |
| Held batch | Working capital, supply commitments | Partly your customer | exposed |
| Inspection finding | Remediation project on a fixed deadline | The regulator | exposed |
Find out which stage you are at
The readiness score names the two domains carrying your exposure. Together with this figure, that is a business case rather than a worry.