Six Sigma Terminology - O to Q

Operational Cost Target

This value represents the maximum expenditure for material, labor, outsourcing, overhead, and all other costs associated with that project. This figure can then be divided between the various operations comprising the manufacturing process to control costs at each step.

Operational Cost

Sometimes referred to as Revenue or Running Costs, these are the costs resulting from day-to-day running of an operation, e.g. staff costs, hardware maintenance, and electricity. 

Operations Process

Known for leveraging economies of scale and narrowly defined tasks, it is one of a family of four work processes characterized as an on-going endeavor undertaken to create a repetitive product or result which is performed by people, planned, executed and controlled. (Artisan Process, Project Process, Operations Process, Automated Process)

Ordinal Data

"Ordinal" data involves placing information into an order, and "ordinal" and "order" sound alike, making the function of ordinal data also easy to remember. For example, suppose you receive a survey from your favorite restaurant that asks you to provide feedback on the service you received. You can rank the quality of service as "1" for poor, "2" for below average, "3" for average, "4" for very good and "5" for excellent.

The data collected by this survey are examples of ordinal data. Here the numbers assigned have an order or rank; that is, a ranking of "4” is better than a ranking of “2.” However, even though you have assigned a number to your opinion, this number is not a quantitative measure: Although a ranking of “4” is clearly better than a ranking of “2,” it is not necessarily twice as good. The numbers are not mathematically measured or determined but are merely assigned as labels for opinions.

Paired T-Test

The paired sample t-test, sometimes called the dependent sample t-test, is a statistical procedure used to determine whether the mean difference between two sets of observations is zero. In a paired sample t-test, each subject or entity is measured twice, resulting in pairs of observations. Typical applications of the paired sample t-test include case-control studies or repeated-measures designs. Suppose you are interested in evaluating the effectiveness of a company training program. One approach you might consider would be to measure the performance of a sample of employees before and after completing the program and analyze the differences using a paired sample t-test.

Pareto Principle

The principle is named for Vilfredo Pareto, an Italian economist. The Pareto principle, also known as the 80/20 rule, is a theory maintaining that 80 percent of the output from a given situation or system is determined by 20 percent of the input. The principle doesn’t stipulate that all situations will demonstrate that correct ratio – it refers to a normal distribution. More generally, the principle can be interpreted to say that a minority of inputs results in the majority of outputs.


Process Decision Program Charts are used to delineate the required steps to complete a process, anticipate any problems that might arise in the steps, and map out a way of counteracting the problems. With process decision program charts, you are prepared for any difficulties before they occur. A properly thought out PDPC means that no task is left undone and no unanticipated problem arises.


PFMEA is a methodical approach used for identifying risks on process changes. The Process FMEA initially identifies process functions, failure modes their effects on the process. The PFMEA also tracks improvements through Risk Priority Number (RPN) reductions. By comparing the before and after RPN, a history of improvement and risk mitigation can be chronicled.


Japanese term which means mistake proofing.

A poka-yoke device is one that prevents wrong parts from being made or assembled or easily identifies a flaw or error. Or “mistake-proofing,” – a means of providing a visual or another signal to indicate a characteristic state. Often referred to as “error-proofing,” poka-yoke is the first step in truly error-proofing a system. Error-proofing is a manufacturing technique of preventing errors by designing the manufacturing process, equipment, and tools so that an operation literally cannot be performed incorrectly. The art of reshaping, an organization and belonging processes to attain the optimal result, through continuous improvements within the organizational.

Process Management

Administrative activities aimed at (1) defining a process, (2) establishing responsibilities, (3) evaluating process performance, and (4) identifying opportunities for improvement. It is also known for leveraging cross functional teams and specifically defined activities; it is one of a family of four work process types characterized as a temporary endeavor undertaken to create a unique product or result which is performed by people, planned, executed and controlled.

Qualitative Data

Qualitative data is a completely different way to look at how to collect and analyze information. Qualitative data is when descriptive statements can be made about a subject based on observations, interviews or evaluations.

One way to remember this is that the word qualitative is similar to the word quality, which is a key component of qualitative data.

Quality Assurance

A planned and systematic set of activities to ensure that variances in processes are clearly identified, assessed and improving defined processes for fulfilling the requirements of customers and product or service makers.

A planned and systematic pattern of all actions necessary to provide adequate confidence that the product optimally fulfills customer’s expectations.

Quality Control

Quality Control measures both products and processes for conformance to quality requirements (including both the specific requirements prescribed by the product specification, and the more general requirements prescribed by *Quality Assurance*); identifies acceptable limits for significant "Quality Attributes"; identifies whether products and processes fall within those limits (conform to requirements) or fall outside them (exhibit defects); and reports accordingly. Correction of product failures generally lies outside the ambit of Quality Control; correction of process failures may or may not be included.

Quality Management

Quality management is the act of overseeing all activities and tasks needed to maintain a desired level of excellence. This includes the determination of a quality policy, creating and implementing quality planning and assurance, and quality control and quality improvement.

Quality Target

Each operation in the manufacturing process, which has an effect on the conformance of the end product to the customer’s specifications, is assigned a Quality Target value. This value represents the maximum allowable discrepancies per 1,000 opportunities


The minimal number of officers and members of a committee or organization, usually a majority, who must be present for valid transaction of business.