Taguchi Quality Loss Function (QLF)

Taguchi Quality Loss Function (QLF) - The principle, for which Dr. Genichi Taguchi who won the Japanese Deming Prize in 1960, that deviations from the ideal cause different degrees of loss in Quality_ and economic loss. Small deviations in some critical characteristics can cause significantly more economic loss than even large deviations in other characteristics. The Loss can be roughly expressed as a formula

where

   L = overall economic "Loss" caused by deviation from the target Quality_
   D = the "Deviation" from the target Quality_ expressed in standard deviations
   C = the "Cost" of the improvement to produce it to the target Quality_

Some Information Quality_ problems are likewise critical and cause significantly more economic loss than others, and become the higher priority for process improvement. (Q) (Taguchi, "Robust Quality_," Harvard Business Review, Jan-Feb 1990, p. 68.)

[Category=Data Quality ]

Source: Larry English, http://www.iaidq.com/main/glossary.shtml , 12-Feb-2009 10:50