Principles Illustrated by Monthly Billing Cycle-Time Example
The previous blog post illustrates several key features of Statistical Thinking. One of these features is that Statistical Thinking is a philosophy of learning and action. That is, learning how to best obtain information which forms the basis of effective action. In the example, an important first step was to create a systems map and flow chart. Next the team collected cycle-time observations. Statistical Thinking evaluates a process by collecting data in addition to past experiences and perceptions. These data may be numerical (cycle-time measurements) or simply process documentation. The systems map and the flowcharts are process documentation. Once we have this documentation, we can ask why we operate in that manner and how we can improve the system. These data allow us to advance beyond personal opinions expressed by individuals. Recall that the departments involved thought that the other departments caused the lengthy billing time. Snee (1986) points out that “Good Decisions are based on facts, not opinions and emotions. … without data everyone is an expert.”
One guideline for effective application of Statistical Thinking is to always flowchart the process. The flowchart shows the relationships among different people and functions. Examining the flowchart suggests opportunities for improvement and areas for further examination and data collection.
The acronym SIPOC depicts our systems view of a process. The following figure depicts the SIPOC components which are Suppliers, Inputs, Process, Outputs and Customers. One motivation in the Monthly Billing-Time Example was to satisfy customer interests. 
References
- Snee, R. D. (1986). "In Pursuit of Total Quality." Quality Progress 20(8): 25-31.
