Six Sigma | Mis-managing with Numbers | Green Belt 2.0® Lean Six Sigma | fkiQuality HD

We always compare pairs of numbers! This month's results to last month's, this year's to last year's, ... how much does this tell you?
Then, how do you try to explain every change up or down ... or even that there was no change?
There's a big difference between describing numbers and understanding the operations that produced them.
Discover the control chart to see results in time sequence and filter out the noise to find the signals to action.
You will find it far more useful than red-amber-green dashboards.

[@Jaguzma2]

Numbers alone would be meaningless. Managing with numbers alone would potentially lead to bad decisions or making bad calls. Dashboards and limits help the numbers give a better understanding of data.

[@noahvandyke3458]

Charting numbers gives a whole new perspective to data. A year's worth of numbers can tell me a lot of what I need to know when it comes to performance. It's like a story board. Thank you for bringing us this informative content!

[@jenniferb5322]

This video clearly illustrates the need for control charts with an upper control limit and a lower control limit versus simply comparing recent data to past data without the ability to see/calculate acceptable variations and how comparison data can promote bad behavior, over-reactions, or inaccurate conclusions. Thank you!

[@dwartneywortham2353]

I did not realize how the numbers played such an effect when it comes to operational results. Watching in this video there are a lot of numbers being thrown around that will impact my final percentages. Good stuff.

[@mattmack8103]

excellent illustration on how managing with numbers requires that we give correct meaning to each value.

[@AndyPostula]

This video shows good examples on how control charts show you precise and current data. Using this you can address the problems and improve the process.

[@rlcardcollection]

For me this video shows that even though there may be variation in your data, it may just be something that isn't controllable and that using a control chart will help filter that out and show you the true meaning of your data.

[@Adam-fd6qp]

This is a great example on how control charts show you accurate and current data. Using this you can address the problems and improve your process.

[@danagreene6800]

This helps to realize how important control charts are. We need to keep an eye on numbers daily.

[@EricGavlick-r7z]

Control charts are key for a manager because they allow you to look at trends and see where the resources need to be placed. Even the best processes can always be refined.

[@mitchzavesky4734]

Nice way of demonstrating how data with no context can easily be misread and mismanaged. For this example, by putting the data and a control chart, you can easily see when the problem occurs, or when to really start to take action. With just the data on its own, you may think you see those moments, but by visualizing the data, you can see it much clearer and choose your resulting actions more confidently

[@JacobReuter28]

A good video about the difference between the natural variation in a process and the special case variation. While having a quick snapshot into the current performance is a good idea, it needs to have more complete data available for management to use to confirm if there is a problem that needs to be fixed or not.

[@cjtrumpeter]

In my past years as an Operations Manager for a company, we used the terms "Ops-controllable" to refer to any variations that was actionable Under the Roof versus non-ops controllable, which may be considered "noise". By watching the controllable KPIs we were able to identify the signals for Operations to take action versus a signal for marketing, sales, etc.

[@Student-uo1fn]

Feels like month over month budgets are viewed this way in my organization, I will utilize this approach when defending or justifying variations month over month.

[@Bittersweetdstny]

Understanding the process for these figures is more important that just seeing them at face value. It could be for a multitude of reasons. Understanding the reasoning and process behind it is a must.

[@dropinceo]

I'm a fan of dashboard to give leadership a quick snapshot into the current period, but I always include the trend & pareto as backup to complete the story. I also am keen to provide a management summary to explain what the trends mean and leadership actions to sustain or to course current a potential negative trend. As a practitioner, I will always react / propose solutions to negative trends, but I challenge people to also answer the question, what is working well to get the desired results. If they don't know what is contributing to the positive trend, meaning understanding the input variables, then the same good fortune will result in bad fortune and no one knows what levers to pull. So y=f(x) is also critical to managing the trends. Many thanks for great content and I look forward to more.

[@BeatriceDosu]

Control charts are very valuable in helping manage, for instance, operation in a "levelheaded" way. It gives a better picture unlike a histogram.

[@ryananderson8130]

It's the awareness of the issues that sometimes by itself can be sufficient for change followed by the numbers.

[@jaybabyflow9463]

Its important that we as managers dont over react to numbers especially without looking deep into the data and finding the natural tendency and trends

[@xxqqff]

The context gained when you compare more than a single data point gives you the ability to make better judgements about causes of issues and how to solve them.

[@dustinclarke6607]

I like the use of control charts on the floor because associates can see the outcome of their day to day operations and from a visual representation see a target in order to know where performance improvements are needed

[@louisscarlati4848]

This shows why control charts are so important. Without context, numbers are just numbers

[@jasonglatz232]

Identifying the desired target for expenses and realizing the variation of unknown variables will support the managers goals. Using a control chart will help eliminate the noise and find the natural variation.

[@victorgomez1437]

Control charts are a great tool to alert us of any critical variation.

[@nikiansell9949]

I was actually surprised to learn that so many companies only compare single values, I can see how this would be very misleading. I would think more organizations would use data driven decision making. Good explanation of what can happen using a pairwise comparison approach.

[@Music1234Man]

I think it is really cool that you can set upper and lower limits that are based on the chart's natural variation. But the speaker also did a good job how data given to management can only be small snippets of a bigger trend

[@alexissmoot6291]

It's important to understand that pairs of values can change for no reason or due to random variation outside of our control or ability to manage. Control charts can be a good tool to monitor the situations that we can control.

[@renztabiliran8131]

It's important to analyze and understand a set of data in a bird's eye view. Knowing the limits will paint a better picture if the data is really bad or is just a false interpretation.

[@rebekkaherrington4509]

I've seen this kind of over-simplification occur in "analysis" especially when it appears beneficial to the group producing it. Adding the visualization with a control chart really helps pinpoint what is important.

[@Money_Co]

Good idea to be wary of the numbers, this gives a better judgement of how to solve problems.

[@musicotriste69]

Homero Cardoso: Control charts are great to see the trends of a department and understand the performance better, knowing that some ups and downs in the data is just noise.

[@hillary6019]

It seems fairly obvious but I really like the idea of the control chart, it allows you to immediately look at the areas that need to be focused on.

[@mikhailsirota9556]

Its always important to see the trend in the data in order to filter out the noise.

[@Envyslays16]

As a manager, my operating costs have many factors that go into play. Most operating budgets are not fixed budgets and do change based on what is happening in the business. However, the data must be updated accordingly. It is essential to stay within the budget, not only monthly, quarterly but also yearly. In this example, if the budget was 20,000 per year, the yearly “actual” was 20,409.09, making us $409.09 in the red. So as you mentioned in the video, you must look at the big picture to figure out the different variations to justify or explain the difference.

[@slee3249]

when the data was looked through the control chart, it was within the upper & lower control limit and they were due to natural variation. so in essence, all those mgmt motivations & urgency didn't really affect the numbers.

[@insertwords10791]

The context that the numbers and values exist in are just as critical, if not moreso, than the numbers themselves. If they exist in a vacuum, you have nothing. Control charts help to add this context to understand the reality of whatever metric is being evaluated.

[@brigittedickey3298]

Control charts seem pretty helpful to manage numbers. You can see whats trending to see what direction you need and want to go.

[@rafaelhernandez1981]

A good reminder that as important as numbers and statistics are in management, they can also lead you wrong if you're not careful about how you use them.

[@ChristopherStefan]

This video emphasizes the importance of understanding the variability in a process and applying that known variability to establish control limits. It's easy to see how one may be mislead by a few data points without knowing the process variability.

[@margaritorios]

This video gave me an idea of how I am going to track from now on my work. I am going to create a control chart for the pieces that I manufacture, we don't have any kind of data on my department, I am going to start with myself!

[@Ace_theMaster]

It is always good to look at data in trend instead of comparing two consecutive points. Additionally, the data will be more powerful if it is supplemented by contextual data as well. This way, instead of wasting time guessing why there was a spike in costs (in reference to this example) or why do we have some outlier points, you can bring a clear picture to your team if you note for each week (or whatever chronological sequence data you have) that there was a limited amount of labor during that week, or parts were backlogged, or inflation went up, or maybe new equipment was installed and operators have not been fully trained on the new machine. Thus, you can continue your analysis and see if other variables have come in to play that are affecting the results that you are seeking.

[@fkiQuality]

Yes, don't waste time reacting to noise, but study the root causes when you get a signal.

[@nathanfey6835]

Great video. I track operational costs by YTD expenses going back 3 years to identify trends and variables. Often, we end up comparing consumable cost trends to production rates but this doesn't always fit perfectly. Using control charts with upper and lower limits should open up a new way to analyze cost data. I'll try it out in the next few weeks.

[@user-yz5cw5st5b]

Until this video I would have thought that the first way of presenting data was enough and I sure would have been panicking like the hypothetical managers. I see the importance of having control limits to help keep our actions in control.

[@samanthadulceak7200]

The natural variation is something new to me. In my current employment, everything is a fire (over reaction) but nobody knows why. It makes for an interesting day...

[@nicholaspesek5902]

At my job we use control charts and other various charts for many different tasks and they help a lot when trying to explain trends and how something Is coming along.

[@vaniavargasjimenez2358]

And this example it’s not just applicable in expenses, I have seen this kind of behavior in sales. However, there are cycles of sales depending of the product, the main idea is control the process or in this case the sales in order to avoid large fluctuations.

[@JamesBehn-pl4li]

Video showing how Control Charts can be a great management tool, to filter out the noise, and be able to see more clearly when action is needed.

[@alanharker2433]

Using the control chart allows you manage the numbers by looking at trends. Great tool manage different aspects of the business

[@donggunko9809]

Like mentioned in the video, there are so many random things that we cannot control. TO take account of these randomness, having the control limit makes sense. If we want to keep it tight control limit, we will need to figure out what contributes to the randomness and correct that. However, this will be cost, so having a reasonable control limit will not only keep your product reasonably controlled but also keep it inside the budget.

[@fkiQuality]

Be careful when you say "keep a tight control limit" because the user DOES NOT choose the limits, instead they are calculated from the data -- they are the voice of the process telling us how it behaves when measured with a variable.

[@dennislyons2730]

This will allow to manage budgets and control cost where needed from month to month in order to stay on a budget

[@domingomoccia2038]

Control chart helps to identify tendencies and verify if the process is under control

[@jeffmaes5892]

Control charts help to follow the trend of an operation and allow you to make changes as necessary to improve the process. It is important to drill down on the numbers to understand their significance.

[@mariaflores-tl1gk]

It is important to use Control Charts to avoid misconceptions and overreact to variable data.

[@danielarcher9175]

Great video!

[@denisek743]

I can imagine that although looking at a control chart based on the natural variation is better at exposing signals to action, a manager would continue to use that “yellow area” on the graph as their signals to action.

[@kahinazanoune4876]

Control chart is a process control tool used to determine if a business process is in a state of control

[@mmaphefoseseni6625]

Very informative

[@julianmcdonough1590]

I like the colored zones or target area as a visual. This may minimize time spent on variance analysis.

[@ryanperlic4567]

Control charts help provide insight into what changes resulted in differences in process performance.

[@jerryyedlinski3186]

It’s like you were actually describing one of our tooling budget meetings, where you there?... “Next year’s new budget is 1.8% of this years.” I would reply but demand has gone up and the tooling hasn’t been holding up as well.

[@GlennFrazee]

This is a good way to avoid reactionary management and instead try to see the data in a more rational manner. Also, operational expenses looked at in a vacuum (i.e., without comparison to production levels, sales, etc.) is only telling half the story.

[@mitchellhoem2003]

Without appropriate context or a proper frame of reference, most data is meaningless. Certain data might look "worse" but it needs to be put in the context of the greater operation. The control charts shown in the video can help managers truly understand the health of their project/business, which will allow them to better focus their efforts on processes that actually need improvement.

[@karimerrills207]

When the numbers are fluctuating, management need to determine what is driving the numbers If management looks at the numbers only they may not make corrections which over time could effect sustainability. Another aspect is management could watch the trend and once have more data implement change.

[@mremann893]

Not enough data can be a bad thing...some history would provide clarity I would think. Good idea to be wary of the numbers.

[@mayraambriz9894]

Control charts help to filter out the noise which could lead to better management .

[@jennifersacksteder9846]

Its important to give meaning to each number and get more data points and not assume what the data says

[@kathyknapp5519]

The case for using Control Charts---filter out the noise so you see the signals that need correcting.

[@Ganjagoddessgrower]

This video explains why looking too narrowly without context at a process the data is incomplete. A control chart separates ‘noise’ from real signals.

[@HangarClippers]

Joseph Tshulos I have seen managers play games with expenses like this, one month they are high. So the manager doesn’t look bad, they have people bill for the next month. So the peaks don’t look that bad. This is a way not to do business, looks good on paper, but the problems will still exist.

[@alejandragarza6402]

We must have desired targets in order to improve performance or operations

[@Student-ws8wg]

Dashboards, limits, AND scorecards with benchmarking will all minimize numbers mismanagement.

[@patriciazuno1694]

Without knowing the upper and lower limits that take into account the natural variation, we will continuously find ourselves thinking we are in crisis mode when in reality we are within the natural behaviors.

[@nathanstratton7918]

Many times departments only look at month by month decreases and not overall trends why there are decreases and increases over a period of time

[@christianhagner6509]

So this looks to me like a run chart with some kind of hysteresis built into it to avoid the 'all of a sudden' knee-jerk reaction anytime it falls out of a small threshold of acceptability. This is the first time being introduced to this kind of chart, I'm interested to see how else we can use something like this.

[@johnsciortino7217]

Do you feel control charts are best to be used weekly? Operating expenses are set with the budget but can fluctuate based on rising or declining sales. This year has been a huge challenge with covid. We have had to adjust multiple times both ways.

[@williamhansen4837]

managing off of one data point vs the average or to the right signal is critical for leadership because we can waste time and talent chasing the wrong event.

[@QuantativeCOD]

There is simply not enough data to justify the data collection period, the current SOP of how the numbers are being recorded, or concisely two many 'unknowns'. If the operations manger is receiving feedback on the reduction in numbers, and why there is such drastic changes from a bi-weekly recording period, then they would ask the 5 why's and obtain more data to confirm what needs to be included to maintain the green zone expectations and make their approach a more refined streamlined process. Yee-haw!

[@fkiQuality]

Data is not missing, what is missing is context to interpret what is noise and what is a signal.

[@jakehardy7772]

I see a lot of over-reactions or over correcting all the time from Machine operators at work who are constantly writing down numbers of parts they have checked during their run and comparing them.

[@collinschmidt915]

Classic example of trying to make a trend line out of two data points

[@florahatzis5019]

As a manager I would not feel comfortable relying on this one dimensional number set.

[@yunielcarmona3377]

agreed

[@karlajohnson8017]

There is always random variation -it could tax heavy q1, days in a month, a discount or credit , damage or cost of claim- we need to look at trends not blips and sustainability

[@christopherrogers7303]

I would like to implement control charting but maybe I missed something in the video or I didn't understand the video entirely. How do we identify the control limits within the data? Is there where we implement STDEV.S and multiply by 3 on both sides? Or am I way off?

[@fkiQuality]

Chris, we will cover this in class, but also watch kzbin.info/www/bejne/ipXdgKGbacRpgaM

[@oscarchiquito2609]

This is what happens when you allow departments to be in their comfort zone. If expectations are not set and enforced you will be forced to react in most instances.

[@johnstanley491]

Making decisions based on data isn't sufficient to improve your processes. You need to understand WHY the numbers change over time to make informed decisions.

[@michaelparks8673]

Don't over-react to numbers. Instead analyze the numbers to see what they are telling you.