## Operating Characteristic (OC) Curve

The OC Curve is used in sampling inspection. It plots the probability of accepting a batch of items against the quality level of the batch.

## The Seven Management and Planning Tools

The Seven Management and Planning Tools have their roots in Operations Research work done after World War II and the Japanese Total Quality Control (TQC) research.

In 1979 the book Seven New Quality Tools for Managers and Staff was published and was translated into English in 1983.

## The Seven Tools

### Affinity Diagram (KJ Method)

Affinity diagrams are a special kind of brainstorming tool that organize large amounts of disorganized data and information into groupings based on natural relationships.

It was created in the 1960s by the Japanese anthropologist Jiro Kawakita. Its also known as KJ diagram,after Jiro Kawakita.When to Use an Affinity Diagram 1)When you are confronted with many facts or ideas in apparent chaos 2)When issues seem too large and complex to grasp

### Interrelationship Digraph (ID)

This tool displays all the interrelated cause-and-effect relationships and factors involved in a complex problem and describes desired outcomes. The process of creating an interrelationship digraph helps a group analyze the natural links between different aspects of a complex situation.

### Tree Diagram

This tool is used to break down broad categories into finer and finer levels of detail. It can map levels of details of tasks that are required to accomplish a goal or solution or task. Developing the tree diagram helps one move their thinking from generalities to specifics.

### Prioritization Matrix

This tool is used to prioritize items and describe them in terms of weighted criteria. It uses a combination of tree and matrix diagramming techniques to do a pair-wise evaluation of items and to narrow down options to the most desired or most effective. Popular applications for the Prioritization Matrix include Return-on-Investment (ROI) or Cost-Benefit analysis (Investment vs. Return), Time management Matrix (Urgency vs. Importance), etc.

### Matrix Diagram

This tool shows the relationship between items. At each intersection a relationship is either absent or present. It then gives information about the relationship, such as its strength, the roles played by various individuals or measurements. Six differently shaped matrices are possible: L, T, Y, X, C, R and roof-shaped, depending on how many groups must be compared.

### Process Decision Program Chart (PDPC)

A useful way of planning is to break down tasks into a hierarchy, using a tree diagram. The PDPC extends the tree diagram a couple of levels to identify risks and countermeasures for the bottom level tasks. Different shaped boxes are used to highlight risks and identify possible countermeasures (often shown as ‘clouds’ to indicate their uncertain nature). The PDPC is similar to the Failure Modes and Effects Analysis (FMEA) in that both identify risks, consequences of failure, and contingency actions; the FMEA also rates relative risk levels for each potential failure point.

### Activity Network Diagram

This tool is used to plan the appropriate sequence or schedule for a set of tasks and related subtasks. It is used when subtasks must occur in parallel. The diagram enables one to determine the critical path (longest sequence of tasks). (See also PERT diagram.)

## Regression: the Mother of all Models – Retail Case Study Example (Part 9)

Retail case study example for marketing analytics.

Problem definition:  Part 1 & Part 2
Description: Part 3
Association: Part 4
Classification: Part 5, Part 6,  Part 7 & Part 8

In this part, we will learn about estimation through the mother of all models – multiple linear regression. A sound understanding of regression analysis, and modeling provides a solid foundation for analysts to gain deeper understanding of virtually every other modeling technique like neural networks, logistic regression, etc.