Quality Wireless (A) and (B)

Process Capability

Process capability can be defined in a variety of ways. The simplest approach is to

examine the proportion of times that the process fails to meet specifications. The call
center has an internally targeted average daily hold time of less than 110 second. We start
by considering the process capability over the two-year period of 2003-2004.

The number of days in 2003-2004 when the average was less than 110 seconds is 491.

Proportion of days within specification = 491 / 731 = 0.672.

Thus, the call center process can be viewed as having stayed within specifications 67.2
percent of the time in 2003-2004.

Process capability can also be measured in terms of the number of standard deviations the
specification is away from the mean. The call center process has a mean hold time of
99.67 and a standard deviation of 24.24. The specification is 110 seconds. Thus, we have:

-capability of call center = (110 – 99.67) / 24.24 = 0.426.

The call center is a 0.426-sigma process. The expected fraction of days within
specification from a 0.426-sigma process is obtained as NORMDIST(0.426) = 0.665.

Performance of the New Process

The thirty days after the process change contain only one day when the average hold time
exceeded specifications. Thus, in the month of April 2005 the process was within
specifications 96.67 percent of the time.

If we take the April performance (a mean of 79.50 and a standard deviation of 16.86) to
be representative of the performance of the new process, the expected fraction of days
within specifications is NORMDIST(110, 79.50, 16.86, 1) = 0.965. The -capability of
the process would then be (110 – 79.50) / 16.86 = 1.81.

Has the Process Improved?

With just thirty days of data, how can we infer whether the process has improved or not?
A good start is a hypothesis test to see if the sample of thirty days observed is likely if the
process has not improved. The original process had a mean of 99.67 and a standard
deviation of 24.24. Thus, samples of size 30 are expected to have a mean of 99.67 and a
standard deviation of 24.24 / 301/2 = 4.43. Therefore,

Probability of a sample of size 30 with an average of 79.50 or lower

= NORMDIST(79.50, 99.67, 4.43, 1) = 2.64E-06.

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There is a very low probability that such a sample could have been observed if process
performance was unchanged. We can thus reject the null hypothesis that the average daily
hold time for the process is still at 99.67 or more. In other words, we can be quite
confident that the process has improved.

Process Performance in September

In this analysis we want to bring up two points. The first point is that there is a
reasonably high likelihood of observing the ten-day performances observed in September
(both worse than before and better than before) even if the underlying process
performance has not changed. The second point is that if the underlying process
performance has not changed and we observe ten days where the performance is much
worse than average, it is very likely that the following ten days will show an
improvement in performance. Similarly, if we observe ten days where the performance is
better than average, it is quite likely that the next ten days will see worse performance.
Managers often mistake this to mean, “Yelling at people after they perform poorly
improves performance,” and “Patting people on the back leads to them slacking and a
drop-off in performance.” The objective of this discussion is to show that SPC can be
used to infer whether a true drop-off or improvement in performance has taken place.

We start with the ten days from September 1 to September 10. The observed average
daily hold time over the ten days was 86.6. The first question we can ask is the
probability of observing ten days with an average daily hold time of 86.6 or more if the
process performance has an average of 79.50 and a standard deviation of 16.86.

Mean of samples of size 10 = 79.50

Standard deviation of samples of size 10 = 16.86 / 101/2 = 5.33

Probability of observing ten days with a mean of 86.6 or higher

= 1 – NORMDIST(86.6, 79.50, 5.33, 1) = 0.0915

Thus, there is a 9.15 percent probability of observing the average daily hold time over ten
days to be 86.6 or larger if process performance is still continuing with a mean of 79.50
and a standard deviation of 16.86.

Now consider the ten days from September 11 to September 20, where the observed
average daily hold time was 74.4 seconds. In this case we have:

Probability of observing ten days with a mean of 74.4 or lower

= NORMDIST(74.4, 79.50, 5.33, 1) = 0.1693

Thus, there is a 16.95 percent probability of observing the average daily hold time over
then days to be 74.4 or less if process performance is unchanged. In other words, both
ten-day observations could have occurred even if the underlying process performance is
unchanged. If process performance is unchanged, a ten-day period with an average of

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88.6 is very likely to be followed with a ten-day period with a lower average (whether
Jackson yells at the supervisors or not). Similarly a ten-day period with an average of
74.4 is very likely to be followed by ten days with a higher average (whether Jackson
pats the supervisors on the back or not).

What we need is some form of hypothesis testing to see if process performance has really
changed or not. This is what SPC accomplishes. As a result, we can discuss upper and
lower control limits to help us determine if the observed variation is internal to the
process or not.

UCL = 79.50 + 3(5.33) = 95.49

LCL = 79.50 + 3(5.33) = 63.51

Observe that both ten-day periods (September 1-10 and September 11-20) have averages
that lie within the control limits. Thus, the call center process is in control.