Genichi Taguchi

Taguchi emphasizes an engineering approach to quality.
He stresses producing to target goals or requirements with minimal product performance variation in the customer's environment.

Variation is termed noise (interference).

Taguchi identifies three distinct types of noise
1-External noise - variables in the environment or conditions of use that disturb product functions (e.g., temperature, humidity, and dust).
2-Deterioration noise or internal noise - changes that occur as a result of wear or storage.
3-Unit-to-unit noise - differences between individual products that are manufactured to the same specifications.

Taguchi focuses on design for quality by defining three design levels
1-System design (primary) - functional design focused on pertinent technology or architectures.
2-Parameter design (secondary) - a means of both reducing cost and improving performance without removing causes of variation.
3-Tolerance design (tertiary) - a means of reducing variation by controlling causes, but at an increased cost.

Taguchi’s Loss Function
Genichi Taguchi developed a "loss function" based on the idea that loss to society occurs whenever there is a deviation from the most desirable value
Taguchi believes that the customer becomes increasingly dissatisfied as performance departs farther away from the target.
He suggests a quadratic curve to represent a customer's dissatisfaction with a product's performance.
The curve is centered on the target value, which provides the best performance in the eyes of the customer.
Identifying the best value is not an easy task.
Targets are sometimes the designer's best guess.
LCT represents lower consumer tolerance and UCT represents upper consumer tolerance.
This is a customer- driven design rather than an engineers specification.
Experts often define the consumer tolerance as the performance level where 50% of the consumers are dissatisfied.
Your organization's particular circumstance will shape how you define consumer tolerance for a product.
The larger the deviation from the desired value the greater the loss to society.
These losses occur regardless of whether or not the specifications have been met.
Any reduction in variation will lead to a corresponding reduction in loss.