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LECTURE 6LECTURE 6

Process Measurement

Business Process Improvement2010

Process Metrics

Measurement – the act of quantifying the performance dimensions of products, services, processes, and other business activities.

Measures and indicators - numerical information that results from measurement – Defects/unit– Errors/opportunity– dpmo

Types of Metrics

Discrete metric – something that is countable

Continuous metric – something concerned with the degree of conformance to specifications

Effective Metrics

SMART– simple, – measurable, – actionable (they provide a basis for

decision-making), – related (to customer requirements

and to each other), and – timely.

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Identifying and Selecting Process Metrics

Identify all customers and their requirements and expectations

Define work processes Define value-adding activities and

process outputs Develop measures for each key

process Evaluate measures for their

usefulness

Dashboards and Scorecards

Dashboard – collection of key operational measures– Graphs, charts, visual aids– Daily information for management

and control Balanced Scorecard – summary of

broad performance measures across the organization– Strategic guidance

Data Collection

Key Questions– What questions are we trying to

answer?– What type of data will we need to

answer the question?– Where can we find the data?– Who can provide the data?– How can we collect the data with

minimum effort and with minimum chance of error?

PRASETIYA MULYA’s ADMINISTRATION TEAM

What types of defects/errors might occur?

How to measure them?

Check Sheets

Check sheets are special types of data collection forms in which the results may be interpreted on the form directly without additional processing.

Check Sheet

Creates easy-to-understand data Builds, with each observation, a

clearer picture of the facts Forces agreement on the definition

of each condition or event of interest

Makes patterns in the data become obvious quickly

xx xxxxxx x

Sampling

What is the objective of the study?

What type of sample should be used?

What possible error might result from sampling?

What will the study cost?

Sampling Methods

Simple random sampling Cluster sampling Judgment sampling

Selecting a Sampling Plan

A good sampling plan should select a sample at the lowest cost that will provide the best possible representation of the population, consistent with the objectives of precision and reliability that have been determined for the study.

Data Classification

Type of data–Cross-sectional —data that are collected over a single period of time

–Time series —data collected over time

Number of variables–Univariate —data consisting of a single variable

–Multivariate —data consisting of two or more (often related) variables

Sample Statistics

Sample Size

ProblemA utility requires service operators to answer telephone calls from customers in an average time of 0.1 minute or less and either respond to them or refer the customer to the proper department within 0.5 minute. The manager is interested in estimating the actual overall time for both components, in total. A pilot study sample of 30 actual operator times was drawn, and the results are given in the following table.

If the service manager wants to be 95 percent confident that the overall time is correctly estimated, with a 3 percent probability of error, what size sample should be taken?

Component Mean Time Standard Deviation

Answer 0.1023 0.0183Service 0.529 0.0902

Metrology - Science of Measurement

Accuracy - closeness of agreement between an observed value and a standard

Precision - closeness of agreement between randomly selected individual measurements

Repeatability & Reproducibility Studies

Quantify and evaluate the capability of a measurement system– Select m operators and n parts– Calibrate the measuring instrument– Randomly measure each part by

each operator for r trials– Compute key statistics to quantify

repeatability and reproducibility

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Process Capability

The range over which the natural variation of a process occurs as determined by the system of common causes

Measured by the proportion of output that can be produced within design specifications

Process Capability Study

1. Choose a representative machine or process

2. Define the process conditions3. Select a representative operator4. Provide the right materials5. Specify the gauging or measurement

method6. Record the measurements7. Construct a histogram and compute

descriptive statistics: mean and standard deviation

8. Compare results with specified tolerances

Process Capability Index

The process capability index, Cp (sometimes called the process potential index), is defined as the ratio of the specification width to the natural tolerance of the process. Cp relates the natural variation of the process with the design specifications in a single, quantitative measure.

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Calculating Process Capability Indexes

Cp = USL - LSL 6s

Cpl, Cpu }

USL - m 3s

Cpl = m - LSL 3s

Cpk = min{

Cpu =

Nominal specification 5

Upper tolerance limit 6.75

Lower tolerance limit 3.25

PROBLEM

DATA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

1 4.92 4.65 5.77 6.25 5.27 5.22 5.47 5.71 5.24 4.42 5.14 4.92 5.79 4.92 5.68

2 4.26 5.54 5.26 4.88 5.41 5.38 4.68 4.54 5.58 5.18 4.26 5.78 3.83 4.80 5.74

3 4.94 5.00 4.76 5.66 6.02 5.08 4.56 4.17 4.72 4.79 4.71 5.50 4.30 4.75 4.65

4 4.29 5.42 4.79 4.44 4.91 4.65 4.70 4.87 5.41 4.73 5.48 5.05 4.78 5.59 5.20

5 5.43 4.79 5.03 4.30 6.07 5.11 4.50 4.91 4.65 4.70          

6 4.81 6.04 4.66 5.47 4.97 4.90 5.24 4.79 4.71 5.50          

7 5.27 4.47 5.25 4.27 5.51 5.91 4.86 5.74 4.81 6.04          

8 4.96 5.18 4.46 4.34 5.02 4.66 4.35 5.03 5.32 4.30          

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Spreadsheet Template