1. The Taguchi Method: C.D.L.M Govt. Engg. College
THE SERVICE MANAGER’S PRIMER TO QUALITY
Submitted to: Submitted by:-
Mr. Pawan Kamboj Sir Chetan Gosain
(Lect. In Mechanical Department) Roll No:-10512
Mech. Branch
4th Year/8th Sem

2. GENICHI TAGUCHI Born in Japan, 1924 Electrical Engineer
Worked during 1950’s to improve Japan’s post-WWII telephone communication system
Father of the “Taguchi Method” and “Robust Engineering”

3. -Quality Loss Function
Topics Covered
Dr. Genichi Taguchi
The Taguchi Method
-Quality Loss Function

4. The Taguchi method
Quality
Robust Design
Quality Loss Function

5. Don’t run away! Not a mathematician?
You can still successfully apply Taguchi Method concepts to your service business.
Basic concepts are simple.
Just keep reading.
Robust Engineering is an excellent way to build high quality into the design of your product.
Increasingly being applied successfully to the service.
Engineers and mathematicians can study and understand the methodology.
But what if you are a manager in a service company, trying to improve services?
DON’T GET SCARED OFF BY THE FORMULAS!
If you understand the basics, you can apply Robust Engineering to your service and measure its success.

6. Competitive Edge 101:
“In the next century, the capability of developing robust technology will be essential to the competitiveness of any manufacturing enterprise.” (Tsai) (Taguchi: p xi)

7. Competitive Edge 102:
“To compete successfully in the global marketplace, organizations must have the ability to produce a variety of high-quality, low-cost products that fully satisfy customers’ needs.” (Robust Engineering; p. xiii)

8. Quality Defined Ideal Quality
- reference point (target value) for determining the quality level of a product or service.
- delivery of a product or a service that reliably performs it’s intended use throughout it’s life cycle under reasonable conditions.

9. Robust Design
“An Engineering methodology for improving productivity during research and development so that high-quality products can be produced quickly and at low cost” (1).
Products and services designed defect free and of high quality
A design with minimum sensitivity to variations in uncontrollable factors.

10. Quality Loss Function Defined
-economical and societal penalties incurred as a result of purchasing a nonconforming product.

11. Determining Quality Loss Function
Specifications are set
Specify a target with minimal variation
Increase in variation cause loss to society

12. Set Specifications Loss to society
-Product rejection -Product rework -Pollution

13. Specify a target with minimal variation
11)
As mentioned earlier, each product has specific characteristics, which should have an appropriate target value.
The picture gives an example of two steps to setting the target. The first step is to reduce variation, and second to adjust the mean to target.

14. Specify a target with minimal variation
Disagreements with standard quality
LSL- Lower specification limit
USL- Upper specification limit

15. Specify a target with minimal variation
Quadratic Loss Function

16. Why use Taguichi’s Quality Loss Function?
1) To find out how much loss is brought to Society due to a purchase of a nonconforming product.
2) To implement a product design improvement.

17. How can we use Taguchi’s Quality Loss Function in real life?
Let’s assume that you are an Operations Manager at a company that produces custom made doors and door frames. During the winter, due to cold weather, doors tend to shrink which lets in cold air through the cracks between the door and the door frame. During the summer doors tend to expand beyond it’s normal size due to hot weather, which makes to door hard to open because it rubs against the door frame. Your job is to produce a door, where dimensions (length and width of the door) are set to a specific target level. In other words in the Winter the door cannot let any cold air in the house and it should open properly in the Summer.

18. How can we use Taguchi’s Quality Loss Function in real life?

19. How can we use Taguchi’s Quality Loss Function in real life?
The picture shows the same kind of a door under different weather conditions. The way to set a target at a specific level, we must first calculate the dimensions of the door under cold conditions and then during the hot conditions (compared to conditions during the winter and the summer). We then take the most cold temp. and add it to the most hot temp.. We then take the answer and divide it by two to get the average temp. We then place the door under the average temp. to find our set dimensions. These dimensions should be the best solution to a robust design.

20. Basic Ideas: CUSTOMER SATISFACTION
Design to the highest standards early in the process to eliminate all non-random errors
Quality Loss = Loss to Society quantified through “Quality Loss Function”
Variation (+/-) from optimal measure results in a loss.
Measure service quality through customer satisfaction
By designing your product or service to the highest standards, you will eliminate the need to correct problems later in the process. “Quality cannot be inspected into a product or a process.” i.e. it happens in the design. (Taguchi: p. ix).
Quality loss can be quantified through a formula called the “Quality Loss Function.”
All variation from the optimal standard measure results in a loss to society through either under or over appropriation of resources.
When quality must be your priority to compete, invest in consulting help to design a Taguchi experiment. The results will be to identify those areas needing attention first.

21. Customer Satisfaction
Ways to measure service:
1. Returning customers
2. Number of complaints (1:10)
3. Number of compliments
4. Employee attitude
How do you know if you are meeting the needs of your customers?
Take a good look at you customer base. How many are return customers?
Find out why they come back, or don’t come back.
How many complaints do you receive? Remember for every complaint you hear, there are TEN you don’t hear.
How many customers take the time to compliment your service?
You employees must be happy with what they do.

22. Quality Loss Concept Deviation from target results in loss.
Lower than target
Greater than target
Both lose
Whenever a product or service misses its intended quality mark, a loss to society occurs.
Whether it is too little service or too much service, resources are lost.

23. Next slide contains math formulas
Quality Loss Function
Quantify the Loss
Warning:
Next slide contains math formulas
But give it a try!

24. Quality Loss Function II
L(y) = k(y-m)2
L(y) = Loss
k = constant = cost to correct
tolerance2
y = reported value
m = mean value (average)
(Taguchi On Robust Technology p. 22)

25. Example:
Company C received an average of 10 complaints per month last year. In November they received 15 complaints (y). Management sets an acceptable level at 2 (tolerance).
It costs the company $50 directly per complaint to correct the problems. They determined the cost in lost sales to be $100.
Total cost per complaint: $150

26. Example continued: k = $150/22 = $37.50 L(y) = 37.50 (15-10)2
= (5)2
= (25)
= $ is loss for the month of November

27. MATH DONE!

28. Taguchi Experiment – Steps According to Dr. Foster: (OM Review p
Managers’ job:
Identify the Problems
Brainstorm
Contribute to experiment design
Facilitator’s job:
Design experiment
Run experiment
Analyze results
Confirm experiment
While a Ph.D. candidate, Dr. S. Thomas Foster wrote an article describing the process for performing a Taguchi experiment within a service enterprise. In that paper he summarized these steps.
To initiate a Taguchi process, managers must perform three steps. They are 1) Problem Identification 2)Brainstorming and 3) Experimental Design
The rest of the experiment can be performed by a consulting facilitator for best results.

29. Step 1: Problem Identification
What do managers and/or employees see that need improvement?

30. Step 2: Brainstorming
Identify critical variables in the service that affect quality.
Open and honest discourse with all people involved.
Decide which factors are controllable and which are not.
Controllable factors include:
Procedures
Room environment
Uncontrollable Factors:
Number of public contacts

31. Step 3: Experiment Design
Using results from brainstorming session, facilitator will design an experiment.
Management must understand this part, and needs to fully support the resources needed for it.

32. Step 4: Experiment Use of ANOVA requires managers understand its use.
Facilitator, although in charge of the experiment, must assure management’s understanding of the process.

33. Step 5: Analysis Factors closest to target specification identified.
Means to reduce controllable variation produced.

34. Step 6: Confirm Experiment
Set up new system using data from experiment.
Test and validate results.

35. Conclusion: Best improvement is early in the process.
Use expert consulting help for full experiment and implementation.
Successfully used in airlines, insurance, hotels and restaurants.
Quality is a major feature that sets a service apart from the rest.
The earlier in the process you build in quality, the more it will help, and the less it will cost.
Don’t try to do this without the help of a very knowledgeable consultant. It will cost less to do this right once, than wrong twice.
Insurance offices, airlines, CPA offices, fine hotels and restaurants have successfully applied the Taguchi Method to their businesses.
Quality is one of the features that sets a business apart from the rest. The new global competitive market brings new dimensions to business.

36. Success Stories
AT&T Bell Laboratories (Computer Response-Time Optimization).
Chrysler Motors Engineering (Sheet-Molded Compound Process Improvement)
-finished products improved from 77% to 96%.
-scrap was reduced from 16% to 1.7%.

37. Summary
Companies design and produce low-cost, highly reliable quality products and processes.
Cuts research, development, and delivery time.
Allows engineers to develop flexible technology for the design and production.

38. Bibliography 1)PRODUCT QUALITY MANAGEMENT BY Frank Moisiadis
2)TAGUCHI APPROACH TO DESIGN OPTIMIZATION FOR QUALITY AND COST Resit Unal & Edwin B. Dean
3) DOE-IBasicDesign of Experiments
Presented By Nutek, Inc.
4) Introduction to Taguchi Method Wekipedia.