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#### mikethepenguin

I am working for an aerospace company and have an answer to a problem which I have tackled but I can't justify the answer.

The cost of a rework for a manufactured part is ?85 per hour. The part has to be made to the following dimensions 195 +/- 0.04mm. What is the cost if the average part size is 194.13mm? The down time attributed to this part failure is usually 25 hours.

I have used the Taguchi Loss Function found around the web...

k = A/Delta = 85/0.04^2 = ?53125 <-- Huge cost already

L = 53125(194.13 - 195)^2 = ?40210.31

So using this formula it's saying the average part cost per failure outside the specification is ?40210.31 for this raverage.

Using the downtime figure earlier 25 x ?84 = ?2100 is the labour cost attributed to this failure...

How could a person taking this to a business justify this cost? I don't understand...it seems absurd. Have I made a mistake in my calculation?

Elsmar have used standard deviation in their formula but I do not understand why?

Any help will be grateful!!!