MGT 3501 Lecture Notes - Lecture 11: Standard Deviation, Common Cause, Statistical Process Control
Document Summary
By observing variation in output in real time. Used to keep processes stable, consistent and predictable. Monitors quality while the product or service is being produced. Every output measure has a target value and a level of acceptable variation (upper and lower tolerance limits) Chances of the bottle being exactly 2 liters is very small, so to meet 2 liters standards every time would result in a lot of defects. So, coca cola give themselves a tolerance limit, a range. Uses samples from output measures to estimate the mean (average) and the amount of variation (standard deviation) The smaller the standard deviation, the better. Need: no bottles above 2. 02l or below 1. 98l. Big difference between what we want and need. Shows how process output varies over time. Helps us identify when variation occurs in our process. Common cause: comes from a stable part of the process. Process one normal, don"t have to do anything.
