J
Jamie Morris
Steve Prevette said:We went over the "Forecasting" chapter, which makes heavy use of moving averages and regression. I would also like you to review the attached paper and provide any comments or real life sagas with such misuse of statistical principles.
See http://elsmar.com/Forums/showthread.php?t=9081 for the paper.
Worth +1 point extra credit on the final.
Steve, your paper and our class discussion of forecasting clearly points out the issues and problems with using moving averages. Companies then compound the problem by assigning trendlines to a data presentation that is flawed from the beginning. The importance of tracking and trending data lies in the ability of the analysis to transpose the data to useful, relevant, timely, and accurate information, which can result in knowledge of the system or process being trended and in changes or improvements that can be made to that system or process. This class has been very useful in pointing out to us that we must use a system approach to bring about improvements and changes in our processes to achieve our ultimate goal of meeting and exceeding the customer's expectations. The use of control charts will provide us with a much better data representation, and hopefully will allow us to tranpose that information to improve our processes and to improve our bottom line. As I have said before, we must analyze each critical component of our system from supply of materials to input to our process to transformation of the materials into a product to output to our inventory to our customers. But ultimately, we must have a complete understanding of our customers needs and expectations, and monitor the data points in our system using statistical process control methodologies to achieve success.