MSG Team's other articles

11645 The Two Conflicting Theories of Recession

The “R” word is back in town. Economists and analysts all over the world are now wary about the fact that a major recession may be just around the corner. They have different facts that make them believe that a recession may be about to happen. However, their conclusions are pretty much the same. For […]

9492 The Great Indian NBFC Crisis

The Non-Banking Financial Companies (NBFCs) are quasi-banking institutions in India. They are allowed to make loans just like banks do. However, they are not allowed to take deposits from people in order to make these loans. Hence, these Non-Banking Financial Companies (NBFCs) borrow money from the bond market in order to make loans. Traditionally retail […]

10750 BPI – Process Walk Through and Process Measurement Analysis

Business Process Improvement projects can be applied to any and every process in any industry. Using BPI it is possible to increase the efficiency of any and every process. Processes though designed well, can become inefficient over a period of time. Besides, processes need to be subject to review periodically to determine the efficiency as […]

9468 The Globalization of Supply Chains and its Implications for Trade and Commerce

Globalization of Supply Chains and its Implications We have discussed how the globalization of the world economy has made the globe more integrated and interconnected. While this has both positive and negative effects on the way global trade and commerce takes place, there is one critical aspect that needs our attention. That is to do […]

12585 Business Process Ownership

Organizations depend upon Business Process Improvement to make changes to the internal operations in order to drive efficiency in the process as well as to impact the business. As the business needs keep changing, the Organizations too need to keep changing at the same speed and frequency to be able to meet up with the […]

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Types of Variables

In the equation - Y = f(X), Y is the dependent variable and it is dependent on the variable X. In other words, when there is a change in value of X then value of Y will automatically change. The following are the characteristics of both types of variables:

YX
Dependent variableIndependent variable
Output of the processInput to the process
EffectCause
SymptomProblem
It is monitoredIt is controlled

It is important to know that the variable or the factor that we want to improve is a Y or an X. If the variable under control is a Y then we should identify the Xs or the independent variables that affect Y and we should focus on improving the Xs and thereby improving the Y. There could be more one X that influences the Y and we should try to brainstorm along with the team to identify as many Xs as possible and then perform Pareto analysis or other prioritization tools to identify the critical Xs that impact our Y.

Customer

Customer is the person (whether internal or external to the organization) who uses the output that the organization produces. A customer could be

  1. Internal to organization - Employees, other departments
  2. Intermediate - person or department who uses the output to perform some operations on the output
  3. External - People outside the organization who actually use the output to satisfy their needs

Customer Requirements

Customer requirements can be defined as the needs of the customer and his expectations from the output that the organization is producing and delivering. When the organization is able to meet all the customer requirements then it will lead to Customer Satisfaction. On the contrary, if the organization is unable to meet the customer requirements then the customers will be dissatisfied and over the period of time they will turn away from the organization’s product. Customer requirements are also called Voice of the customer - “VOC”.

Tools for identifying Customer Requirements

  1. Customer one to one interview
  2. Customer complaints - past history
  3. Surveys
  4. Focus groups

While performing the above the following questions should be asked:

  • What are our customer’s needs?
  • What is the Customer’s perception on our Process performance?
  • How is Process Performance measured by Customer?
  • What performance level of the Process does the Customer expect?
  • What can we improve upon?

Critical to Quality (CTQ)

CTQ stands for ‘Critical to Quality’. In other words it represents the critical requirements of the output. CTQ’s could be derived from Customer requirements, Risks, Economics and Regulations. For eg a CTQ could be on-time delivery or accuracy etc. It is very critical to identify and define CTQs appropriately because it depicts the quality parameters that relate to wants and needs of the customer.

VOC to CTQ Conversion

Once we have collected the voice of the customer (VOC) we then will have to arrive at Critical to Quality (CTQ) elements so that the customer requirements can be incorporated into our process and the output can be produced as desired by the customer.

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