Taguchi Analyzer

Creating an App to Analyze PBC Data for Quality Losses

THE AIM for this post is to share with you a demo of an app that I’ve long-wanted to code to show the relationship between process data and its visualization on a Taguchi Loss Function Curve. I’m hoping to add it to PBC Analyzer PRO in the future as a way of bringing another important aspect of Dr. Deming’s approach to managing with a systems view of quality to a broader audience and make it even more accessible and fun to learn through rapid feedback.

NB: This is just a preliminary, educational demo, it is not representative of a robust application of Taguchi Methods and Loss Functions to analyzing system data for quality.

Loss Functions 101

What is a loss function, you ask? Let’s consult Dr. Deming who writes in The New Economics:

A loss function describes the losses that a system suffers from different values of some adjustable parameter. Use of a loss function is restricted to the realm of losses that are measurable.

The most important use of a loss function is to help us change from a world of specifications (meets specifications) to continual reduction of variation about the target, through improvement of processes.

2nd Ed. (p. 217 ), 3rd Ed. (pp. 149, 151)

Deming provides an example of a simple loss function being the output of people in a room measured in dollars per hour dependent on the temperature of the room. I’ve annotated the curve he provides in The New Economics below to show this: