ACKNOWLEDGEMENT

THE HARDEST STEEL GOES THE HOTTEST FURNACE

The same was the case with us. We face many problems when we started
the work on report but we greatly thankful to Almighty ALLAH for enabling
us to get successfully through our responsibilities.

Very warm and special thanks to our respected teacher Sir

==========whose real dedication & devotion kindled in us hope & light.
Sir we thank your ability of extracting the very best out of us, for your
patience & perseverance & also for acknowledging the efforts made by
us during whole semester.
Objective of the Study:

As competitive pressure has been steadily rising, manufacturing organizations

need to improve quality while decreasing costs and increasing production
volumes with fewer resources. Statistical process control is now fashionable
buzzword in manufacturing industry. It involves measurements of process
performance that aim to identify common and assignable causes of quality
variation and maintain process performance within specified limits.

The main objective is to explain the concept of statistical process control and its
application in manufacturing industry to improve its quality level. The
underlying goal of the study is to reduce the variations and rejections in a
critical process.
Introduction to Statistic:
The original idea of "statistics" was the collection of information about and
for the "state". The word statistics derives directly, not from any classical
Greek or Latin roots, but from the Italian word for state.
The birth of statistics occurred in mid-17th century. A commoner, named
John Graunt, who was a native of London, began reviewing a weekly
church publication issued by the local parish clerk that listed the number of
births, christenings, and deaths in each parish. These so called Bills of
Mortality also listed the causes of death. Graunt who was a shopkeeper
organized this data in the form we call descriptive statistics, which was
published as Natural and Political Observations Made upon the Bills of
Mortality. Shortly thereafter he was elected as a member of Royal Society.
Thus, statistics has to borrow some concepts from sociology, such as the
concept of Population. It has been argued that since statistics usually
involves the study of human behavior, it cannot claim the precision of the
physical sciences. (1)

In the modern world of computers and information technology, the

importance of statistics is very well recogonized by all the disciplines.
Statistics has originated as a science of statehood and found applications
slowly and steadily in Agriculture, Economics, Commerce, Biology,
Medicine, Industry, planning, education and so on.

As on date there is no other human walk of life, where statistics cannot be

applied

Statistics is a discipline which is concerned with:--

 Designing experiments and other data collection,

 Summarizing information to aid understanding,

 Drawing conclusions from data, and

 Estimating the present or predicting the future

Today, statistics has become an important tool in the work of many
academic disciplines such as

• Medicine,

• Psychology,

• Education,

• Sociology,

• Engineering and

• Physics etc.

Examples of Statistics

Statistics can be applied in every field of life such as:--

• Unemployment rate

• Consumer price index

• Rate of violent crimes

• Infant mortality rates

• Poverty rate of a country

• Batting average of a baseball player,

• Standardized test results etc.

Meaning of Statistics

The word 'Statistics' is derived from the Latin word 'Statis' which
means a "political state."

Clearly, statistics is closely linked with the administrative affairs of a

state such as facts and figures regarding defense force, population,
housing, food, financial resources etc.

What is true about a government is also true about industrial

administration units, and even one’s personal life.

In the first place, Statistics is a plural noun which describes a

collection of numerical data such as
 • Employment statistics

• Accident statistics

• Population statistics

• Birth and death

• Income and expenditure

• Exports and imports etc.

Secondly the word statistics as a singular noun, is used to describe a

branch of applied mathematics, whose purpose is to provide methods of
dealing with a collections of data and extracting information from them in
compact form by tabulating, summarizing and analyzing the
numerical data.

Definition by Florence Nightingale

The most important science in the whole world:-

For upon it depends the practical application of every other science

and every art, the one science essential to all political and social
administration, all education, all organization based on experience, for it
only gives results of our experience.

Definition by Croxton and Cowden

Statistics may be defined as the science of collection, presentation,

analysis and interpretation of numerical data from the logical analysis.

It is clear that the definition of statistics by Croxton and Cowden is the

most scientific and realistic one,.

Characteristics of Statistics

• Statistics are aggregate of facts

• Statistics are numerically expressed

• Statistics are collected in a systematic order

• Statistics are effected to a marked extent by multiplicity of causes

• Statistics must be collected for a predetermined purpose

 • Statistics should be placed in relation to each other

Functions of Statistics

• Condensation

• Comparison

• Forecasting

• Estimation

• Tests of Hypothesis

Scope of Statistics

• Statistics is not a mere device for collecting numerical data, but as

a means of developing sound techniques for their handling,
analyzing and drawing valid inferences from them.

• Statistics is applied in every sphere of human activity – social as

well as physical – like Biology, Commerce, Education, Planning,
Business Management, Information Technology, etc.

The scope of Statistics can be discussed as follows:-

• Statistics and Industry

• Statistics and Commerce

• Statistics and Agriculture

• Statistics and Economics

• Statistics and Education

• Statistics and Planning

• Statistics and Medicine

• Statistics and Modern applications

Limitations of statistics

Statistics with all its wide application in every sphere of human activity has
its own limitations. Few of them are:--
 • Statistics is not suitable to the study of qualitative
phenomenon:- like honesty, poverty, beauty, intelligence etc.

• Statistics does not study individuals

• Statistical laws are not exact

• Statistics is only, one of the methods of studying a problem

• Statistics may be misused.

Uses/Applications of Statistics

• To present the data in a concise and definite form

• Used for comparison

• To make it easy to understand complex and large data

• In forming policies

• Enlarging individual experiences

• In measuring the magnitude of a phenomenon.

What is Business Statistics?

The main objective of Business Statistics is to make inferences (e.g.,

prediction, making decisions) about certain characteristics of a population
based on information contained in a random sample from the entire
population. The condition for randomness is essential to make sure the
sample is representative of the population.

Business Statistics is the science of good' decision making in the face

of uncertainty and is used in many disciplines, such as financial analysis,
econometrics, auditing, production and operations, and marketing
research. It provides knowledge and skills to interpret and use statistical
techniques in a variety of business applications.

A typical Business Statistics course is intended for business majors, and

covers statistical study, descriptive statistics (collection, description,
analysis, and summary of data), probability, and the binomial and normal
distributions, test of hypotheses and confidence intervals, linear
regression, and correlation.

Statistics is a science of making decisions with respect to the

characteristics of a group of persons or objects on the basis of numerical
information obtained from a randomly selected sample of the group.
Statisticians refer to this numerical observation as realization of a random
sample. However, notice that one cannot see a random sample. A random
sample is only a sample of finite outcomes of a random process.

At the planning stage of a statistical investigation, the question of sample

size (n) is critical. For example, sample size for sampling from a finite
population of size N, is set at: N�+1, rounded up to the nearest integer.
Clearly, a larger sample provides more relevant information, and as a
result a more accurate estimation and better statistical judgment regarding
test of hypotheses.

Statistics in Business Environment:

Today's good decisions are driven by data. In all aspects of our lives, and
importantly in the business context, an amazing diversity of data is
available for inspection and analytical insight. Business managers and
professionals are increasingly required to justify decisions on the basis of
data. They need statistical model-based decision support systems.

Statistical skills enable them to intelligently collect, analyze and interpret

data relevant to their decision-making. Statistical concepts and statistical
thinking enable them to:

 Solve problems in a diversity of contexts.

 Add substance to decisions.
 Reduce guesswork.

In competitive environment, business managers must design quality into

products, and into the processes of making the products. They must
facilitate a process of never-ending improvement at all stages of
manufacturing and service. This is a strategy that employs statistical
methods, particularly statistically designed experiments, and produces
processes that provide high yield and products that seldom fail. Moreover,
it facilitates development of robust products that are insensitive to
changes in the environment and internal component variation. Carefully
planned statistical studies remove hindrances to high quality and
productivity at every stage of production. This saves time and money. It is
well recognized that quality must be engineered into products as early as
possible in the design process. One must know how to use carefully
planned, cost-effective statistical experiments to improve, optimize and
make robust products and processes.

Business Statistics is a science assisting you to make business

decisions under uncertainties based on some numerical and
measurable scales. Decision making processes must be based on
data, not on personal opinion or on belief.

The Deviation is Inevitable:

Variation is inevitable in life! Every process, every measurement, every

sample has variation. Managers need to understand variation for two key
reasons.

 They can lead others to apply statistical thinking in day-to-day

activities.
 Apply the concept for the purpose of continuous improvement.

INTRODUCTION
During recent years, there has been a growing emphasis on improving the
quality of products sold in today’s domestic and international markets. This
emphasis has been driven by growing competition and by greater
customer awareness and demand for quality products at competitive price.
As competitive pressure has been steadily rising, manufacturing
organizations need to improve quality while decreasing costs and
increasing production volumes with fewer resources. Statistical process
control (SPC) is now fashionable buzzword in manufacturing industry.
SPC is an optimization philosophy concerned with continuous process
improvements, using a collection of (statistical) tools for data and process
analysis making inferences about process behavior.

The methodology used consists of component selection, specification

review, data collection and analysis using cause and effect diagram,
control.
NEED OF STATISTICAL TOOLS IN PROCESS CONTROL

Statistical tools in process control are meant to control the product quality
on-line so that the product conforming to specifications is produced. To be
truly effective, SPC must become an important segment of corporate life
as a part of total quality control program. Statistical tools in process control
are strongly needed due to following reasons:

a) To discover when a process is out of control so that corrective action is

taken well in time.
b) To reduce the cost of internal failures, i.e. scrap and rework.
c) To ensure that operators are paid only for good quality production.
d) To eliminate frequent readjustments and interruptions in the process
which would otherwise result in production loss and greater variability in
product quality?
e) Better utilization of labor, facilities and material.
f) Data obtained from SPC can be used to determine whether the given
process has the potential or capability of meeting the specifications on
various quality parameters. If not, we can undertake a number of remedial
actions to minimize the production of non-conforming product.

Methodology: A case study was undertaken in an automotive ancillary to

implement SPC. A model was first defined by identifying various input and
output parameters and the techniques for quality improvements. These
parameters are process capability indices, defective parts per million
(PPM) and percentage yield. A critical component was selected on the
basis of the cost of rejections as explained in the paper. After selecting
the component, its critical parameters were identified using Pareto
Analysis and these parameters were monitored on-line to control the
defects or rejections.

(Need to revise according to our company)

References:

1) Stigler S. The History of Statistics: The Measurement of Uncertainty

Before 1900, U. of Chicago Press, 1990. It covers the people, ideas, and
events underlying the birth and development of early statistics
2) ww.bocodol.ac.bw/Docs/Documents/Amity_courses.doc -