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by: Ms. Dorian Wiegand


Ms. Dorian Wiegand
GPA 3.66

Suleyman Tufekci

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About this Document

Suleyman Tufekci
Class Notes
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This 3 page Class Notes was uploaded by Ms. Dorian Wiegand on Friday September 18, 2015. The Class Notes belongs to ESI 6470 at University of Florida taught by Suleyman Tufekci in Fall. Since its upload, it has received 23 views. For similar materials see /class/206803/esi-6470-university-of-florida in Industrial Engineering at University of Florida.

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Popular in Industrial Engineering




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Date Created: 09/18/15
AN EXAMPLE ON TAGUCHI S QUALITY LOSS FUNCTION AS IT RELATES TO PROCESS SELECTION Taguchi39s quadratic loss function is given by Ly Kym2 where K AAO2 A cost of each unit returned A0 range of process variability2 USL LSL2 m target value ideal y individual value measured on a product Let A 100 A0 2 m 85 Then K 1001022 4 and Ly 4y852 Let the quality statistics according to the existing process be given in the table below This is based on 50000 units produced Range in the in the range Avg unit Total loss for range loss the range 78 81 10 5000 130 650000 81 84 20 10000 32 320000 84 87 40 20000 10 200000 87 90 20 10000 58 580000 90 92 10 5000 148 740000 Total 100 50000 2490000 Therefore according to the Taguchi39s loss function we have 2490000 loss due to lack of quality Now assume that we can acquire a new process which will produce the product uniformly between 825 and 875 Analytically we can calculate the estimated loss from new process to be 875 825 4y8521875825dy 833333 this is an average loss per unit due to the new process The total average loss for 50000 units will be Total average loss 50000833333 416664 Savings in loss of quality 2490000 416664 2073336 If the cost of the new process is less than 2073336 then the improvement will pay for itself in less than one year For many companies payback period of 2 3 years is a good investment thus according to this calculation we can afford to pay as high as 6000000 if the PB period is 3 years If a simple bathtub quality cost model was used with LCL 80 and UCL 90 then The loss with the original system is calculated as follows 6667 of the range 78 81 will be returned 100 of the range 9092 will be returned Total returned 1667 Total number returned 500000 16667 8333 units Loss due to quality 50000016667100 833333 With the new process no unit will fall outside the bathtub thus all this amount will be saved We therefore can afford a system only if its cost is less than 833333 if we want a oneyear payback Similarly for a three year payback the system we can afford must cost less than 2500000 This is much smaller than the Taguchi model which provides opportunity to look for more advanced technologies Suppose we did nd a technology which was exactly 833333 and we have installed the system According to the bathtub model we are done with the quality issue Since no item falls outside the tub then there is nothing more to save as far as the quality loss is concerned However according to the Loss function model of Taguchi there is still 416664 due to inadequate quality which can be saved Thus the product development and improvement team will look further into adopting new technologies and processes to further improve quality and save the loss due to lack of quality


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