Developed by Genichi Taguchi, the Taguchi Loss Function is a graphical representation of how an increase in variation away from the target value (even within specification limits( leads to an exponential increase in customer dissatisfaction. This is different than the traditional approach of viewing results within the specification limits as good, and results outside of the specification limits as bad.
- Taguchi Loss Function
- Video of Ford Transmission Study: https://www.youtube.com/watch?v=uAfUOfSY-S0
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