Mercer Quality Consulting, LLC   since 2008
 Mike Mercer is an ASQ member since 1988  # 00617707
 ASQ Certified Quality Engineer ) since 1988
  #18042
 ASQ Certified Manager of Quality/Organizational Excellence since 1997 # 2294
Statistical Thinking using an Excel based template called BPChart
Buy the book "Introduction to BPChart " 
for $95 + $5 for S&H and get the BPChart App. Included are all files used to work the examples in the 230 page book.

The following definition is used by the Statistics Division of the American Society for Quality.
 
Statistical Thinking is a philosophy of learning and action based on the following fundamental Principles:
  • All work occurs in a system of interconnected processes,
  • Variation exists in all processes, and
  • Understanding and reducing variation are keys to success.


How do you monitor the Key Performance Indicators (KPIs) for your business? 
By using Balanced Score Cards?  By using Stop Light reports?  Use BPCharts instead to implement Statistical Thinking for your KPIs.

Business Process Charts (BPCharts) visualizes the voice of each KPI and helps separate the signals from the noise.  BPCharts signals when you should investigate the KPI while helping avoid tampering because the KPI is just exhibiting typical noise .

Let me show you how to turn your KPIs into charts which help identify the real changes in your KPI 's performance.

Below is a screen shot of BPChart depicting a seasonal pattern in the KPI for Gas Usage for a typical business. 
  The red dotted lines show the typical performance each month.
  The green line is the average performance.
  The black line shows actual performance. 
  The letter codes along the upper x-axis indicates when a special causes have occurred.    
  Investigation may be warranted when a special cause is signaled, but is usually not warranted
  when no letter code appears.  
  No letter codes indicates the KPI  just exhibits common cause ( or noise.)



Not only can we see individual charts of KPIs but we can assemble multiple charts of KPIs on one page .


Many different forms of KPI's may be modeled including:
 Level (e.g. performance against a fixed targets), 
 Linear and Growth Trends (e.g. sales and income growth), 
 Step Changes (e.g aquisiton of new businesses or lines),
 Seasonal (when events repeat predictably, e.g. prep for back to school or Christmas
 season),
 Custom centerlines (results from time series forecasting models.)


       



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