Taguchi's quality loss function provides a measure of the overall loss to society when a product fails to meet its target functionality and reliability.
Taguchi defines a signal-to-noise ratio (SNR) to measure the positive quality contribution from controllable or design factors versus the negative quality contribution from uncontrollable or noise factors.
Taguchi Methods involve seven steps, beginning with a clear statement of the design problem and ending with a confirming statistical experiment showing how parameter choices enhance robustness.
An example from electrical circuit design was presented because it is much more similar to software design than mechanical design, where Taguchi Methods have found their largest application.
An example from software design or product improvement was given, building on the previous example.
A cause-and-effect or "fishbone" diagram was presented to guide fault analysis for the software example.
Taguchi developed an earlier technique involving Latin squares or orthogonal matrices to allow an evaluation on multiple parameters simultaneously.
Orthogonal matrices permit a multifactorial analysis that not only is far more efficient than a conventional "bottleneck" analysis but also allows the study of factor interactions.
