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Use of Control Charts for Monitoring KPIs with Target Percentages

Six Sigma – iSixSigma Forums General Forums Tools & Templates Use of Control Charts for Monitoring KPIs with Target Percentages

This topic contains 6 replies, has 7 voices, and was last updated by  Chris Seider 1 week, 3 days ago.

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  • #243136

    datasciencedweeb
    Participant

    Hi there,

    I’m wondering is a control chart the appropriate tool to use to monitor KPIs where the data is a percentage, and the target is 100%?

    Since the target is 100%, and a lot of the time that target is hit, the upper control limits are expanding beyond the 100% limit. Should the solution here be to remove upper control limits and only include lower?

    The main goal of using the control chart is to identify a trend. Even though the target is 100%, realistically that target will not be met week after week. Therefore there will be expected variation from the 100% target. So I want to use a control chart and trend analysis to monitor at what point is our performance going beyond the expected variation, and more towards a signal that we are deviating too far from our target.

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    #243145

    Mike Carnell
    Participant

    @datasciencedweeb If you are using a software package check it to see if you can list 100% as a boundary.

     

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    #243165

    Nicholas Iacono
    Participant

    To your first question, yes it is appropriate to use a control chart to monitor KPIs.

    Since you are monitoring a percentage, which control chart to use will depend on how that percentage is calculated (percentages as a metric should throw a yellow flag that you need to do further investigation into that calculation). For example, if the base data behind the percentage is pass/fail, then you’ll be looking at attribute control charts like a p-chart or np-chart. Minitab (if that’s your software) has also added the Laney p’-chart in case your pass/fail data doesn’t fit a binomial distribution (and a p-chart could give you false indications)

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    #243204

    Rhb
    Participant

    I typically use a Time Series Plot with a reference line for the goal in Minitab.  Since you’re just looking at performance trends you don’t really need control limits  You could also calculate the standard deviation and place a LCL at -3 standard deviations with another reference line.

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    #243208

    Anonymous

    I concur with Nicholas that if the percentages are calculated from discrete data, say defectives then you should be using the discrete data (number of defectives and sample size) to calculate the control limits.  In this case when the number of defectives are 0, this corresponds to your 100% case. The control limits for this chart will never exceed 100%. The Laney P’ chart is typically used when your sample sizes are very large.

    [EDITED BY MODERATOR]

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    #243271

    Jess L Cotten
    Participant

    The control charts are good, but you may want to investigate each point of the control limits variance for the true root cause.  This may take you in a different direction in regard to the measure.

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    #243282

    Chris Seider
    Participant

    Consider what you mean by target of 100%.

    Your control chart would be great if no losses were assumed and the theoretical output was included–not planned output.

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