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Correlation and Control Charts
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| Categories: Monthly Summary Tags: business process, business processes, Internal controls, Procedures and Processes, Process Control, six sigma | |||||
Question of the month: Why are control charts so important in measuring process effectiveness?
In October, we continued the Road to Six Sigma series dealing with statistical process control in business settings. We discussed correlation and control charts—two very important concepts that enable you to understand process effectiveness in a systematic manner. The series started, and ended, with a discussion of Dr. Shewhart’s simple control tool, the control chart.
Road to Six Sigma: Correlation between Variables
The term correlation refers to a situation where two variables are seen to change in a more or less predictable way. That is if variable A increases from two to five, variable B is seen to change from 10 to 20. However, correlation tells us only that the two variables change in a predictable relationship to each other. Either may be the cause, or more often, both are affected by changes in some other causal variable. Be sure you know the situation before you assume one variable is the cause of changes to another.
Read more about correlation between variables;
Road to Six Sigma: Control Charts
Control charts for variable individual readings are usually most useful in understanding and improving business processes. This is used when a sample size of one is the only sample available. Examples include daily sales numbers, monthly earnings reports, daily site traffic, or other metrics for which a multiple sample size is not available. Notice the contrast to a manufacturing process where one can randomly choose ten representative products from the production stream, measure them all, and average the results.
Read more about control charts;
“Blog” This – a New Home for Articles
Some time ago I mentioned that we were working on simplifying the article pages on our website. This was in response to your comments about the previous article directory being too cluttered and hard to navigate. To ease the article viewing experience, we have now housed all our articles and other announcements in a blog form.
Visit the new Policies, Procedures and Processes Blog;
The new blog lets you search for articles, and view articles, announcements and other information by categories and, most importantly, use the comment feature to provide your own opinions and thoughts on the topic in question. If you use a feed reader to read blog updates, you may use our RSS feed.
On That Note
Answer to this month’s question:
Control charts are a good way to determine if a test change to a process has a statistically significant effect on the process. Dr. Shewhart’s control rules allow us to mak fairly simple, yet far-reaching conclusions to determine if the process in question is in control or out of control. Because of the reliance on statistical calculations, control charts provide empirical evidence to test process effectiveness and stability.
Please feel free to contact us with any questions or comments that you may have about our products, services or articles. Also, please let us know if you’d like any specific topic addressed in our future articles.
Regards,
Chris
Bizmanualz
Related Articles:
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August 29th, 2007 at 5:32 am
Excellent.