User's guide chapter 2 section 5 & 6



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2.5 – SPC Charts

Statistical Process Control (SPC) charts support your quality and process engineering. You can use them to identify key areas for improvement in a process, and then to monitor process improvement over time. They present complex data in easy to understand formats.

There are several types of SPC charts: Histograms, Run charts (trend charts), Pareto charts, Control charts, Scatter charts, and Pie charts. They are all valuable as planning tools. The next two parts of this section will focus on Pareto charts as an example of how you can use SPC analysis to improve your business planning. The final two parts of this section discuss the use of Control charts to track variation in performance.

2.5.1 – Working with SPC Charts

To select and place SPC charts in a diagram, use the DataAnalyzer Chart wizard on the Insert menu. Select which SPC chart you want to use, and then type your information into the active spreadsheet in the diagram space. DataAnalyzer will graphically convert the data for display in the diagram.

2.5.2 – Using Pareto Charts to Prioritize Process Improvement Efforts

Pareto charts allow you to gather data about the problems you are examining and present graphic representation of the frequency or size of each problem. This provides a way to identify those problems that offer the greatest opportunities for improvement.

The Pareto chart is based on the idea known as the 80-20 Rule: that 80 percent of any result can be attributed to 20 percent of the activities. For example, of 100 errors, 80 can be eliminated by correcting only 20 percent of the causes. The Pareto chart allows you to present your cause data so you can prioritize the causes on which you will focus. It also guides you away from choosing solutions that will worsen the existing situation.

A Pareto chart gives you a different type of information than other ProcessModel analyses provide. Typically, a ProcessModel identifies 1) processing bottlenecks, 2) interdependency problems, 3) resource constraints, 4) cycle time problems, and 5) non-determinate processes. In contrast, a Pareto chart 1) identifies how significant each contributing cause is in a situation, and 2) gives you a visual format to show that relative significance to other people.

Pareto Charts

Analyzing a Situation with a Pareto chart

The basic steps for analyzing a situation with a Pareto chart are:

1. Identify the general problem area you want to investigate and, within that problem, select the specific issues you will analyze.

2. Choose the most useful unit of measurement (such as frequency or cost) for your data collection.

3. Choose the time period for your data collection.

4. Gather current data or review historical data.

5. Compare the relative frequency or cost of each problem category.

6. Set up a Pareto graph by placing the problem categories on the horizontal line and the frequencies on the vertical line. Include the unit of measurement in the chart labels.

7. (Optional) Draw a cumulative percentage line showing the portion of the total that each problem category represents.

8. Interpret the results. Ask: What factor has the most impact on the goals of our business and customers? Remember that the most frequent or most expensive factor is not always the most important.

Variations of the basic Pareto chart can provide additional information by displaying the basic data in different ways. Frequently used variations include:

Major Cause Breakdowns—Break down the tallest bar (i.e. often the cause with greatest effect) into subcauses in a second, linked Pareto.

Before and After Comparisons—Draw “new” Pareto bars side by side with the original Pareto to show the effect of a change. Present the comparison as one single chart or two separate charts.

Data from Multiple Sources—In side-by-side Pareto Charts, show data you have collected on the same problem but from different departments, locations, equipment, and so on.

Data in Different Measurement Scales—Use the same categories, but measure your results differently. For example, compare the measurement of cost and frequency for the same categories.

2.5.3 – Using a Pareto Chart: A Tutorial

Step 1: Setting up the Chart

How To – Select Pareto Chart

1. Click the File menu, and point to New Process.

2. On the Insert menu, click the SPC Chart button. The Chart wizard will appear.

3. On the wizard, click Next to view a list of chart types.

4. Select the Pareto chart from the list in the Chart wizard.

5. Click Finish. A blank data chart will appear.

Pareto Charts

Step 2: Putting Data into the Spreadsheet

How To – Enter data and adjust labels

1. Notice the tabs in the lower left corner. The Spreadsheet tab lets you view and modify the spreadsheet data. The Chart tab lets you view and modify the chart.

2. Double-click the column heading Label. The Column Header Text dialog box opens.

3. Type Process Step, and click OK. Notice the column is not wide enough to display the entire heading.

4. Point to the line between the two column headings. A horizontal double headed arrow appears. Horizontal double headed arrow

5. Drag the line to increase the width of the column until you can see the entire heading.

Adding data to spreadsheet

6. Label the other column Idle Time (hours).

7. Type in the names of the process steps and the idle times in hours.

Adding data to spreadsheet

Step 3: Displaying Data in a Pareto Chart

How To – Display Pareto chart

1. Once you have the Idle Time information and Step Labels in the spreadsheet, click Chart at the bottom of the spreadsheet. A Pareto chart appears, displaying the data you entered.

Display Pareto chart

2. The following results are shown:

The “Receive Approved Purchase Requisition from Manager” step appears first and displays at the far left position. It shows five hours of Idle Time. The next-largest Idle Time step is the “Interoffice Mail Form to Manager” step.

The vertical line at the left of the chart displays the amount of Idle Time. The cumulative frequency (up to 100 percent) is the vertical line at the right of the chart.

The Pareto Chart also displays a curve that identifies what portion of the total causes are attributed to each individual cause.

Important information to be aware of If you wish to change the color of the bars, the style of the background, or the placement of the legend on the chart, follow the procedures in Change the chart appearance.

Important information to be aware of To delete the chart, follow the procedure in Delete a chart.

Step 4: Using Pareto Information to Improve your Processes

Compare the relative contribution of each factor to the results you are observing in the model.

The chart illustrates that the greatest amount of idle time results from two causes:
1) staff must wait to receive the manager’s approval of their purchase requisitions, and
2) staff does not have an interoffice mail form to submit purchase information quickly to the manager. It is likely that if you can solve the problems in these two areas, you can resolve 55 percent of all the reasons for customer calls about slow service. Therefore, the Pareto chart has given you valuable information on how to focus your business resources.

2.5.4 – Pareto Chart: Basic Procedures