Statistics Has Its Moment

Back when I was a student at RPI, I took numerous courses as part of the requirements for my degrees in Management Engineering.  Most of them offered a good foundation in aspects of business which proved very useful in the years to follow.  But only one of them had a massive and lasting effect on my worldview: Statistics.

Statistics?  Why Statistics?  Probably part of the reason was that it took me a while to get the hang of it.  My professor, Dr. George Manners, had a wonderful Georgian accent which was quite different than those of us from New England.  Then, he gave us a test about mid-semester and virtually everybody did poorly.  Then he did a surprising thing.  He got up in front of the class and said that obviously he hadn’t done a good job in teaching the material. So he would cover the material again and give a re-test. Wow! That made me take notice.  So I paid chose attention and discovered there was magic in the art of choosing a sample size, paying attention to aspects such as normalizing the data and running statistical tests.  I did pretty well on the re-test and I also struck up a friendship with the professor which extended beyond the point when I’d graduated.  Later, he taught me Marketing, another course which has had a long standing impact.

Getting back to statistics, I never looked at data the same way after taking this course and a successor course in the design of experiments.  I learned a valuable lesson that many politicians and other public figures have not learned, which is that a sample size of one, or even a few more data points than that, is basically statistically meaningless.  We also learned about the margin of error.  If a political poll is conducted and one candidate leads another by 3 percentage points, but the margin of error is six percentage points, it’s basically a statistical tie, not a conclusion one can bank on.  So when the press, or politicians tout a particular result, I pay close attention to the statistics behind the conclusion and decide whether the suggested results pass muster.  Frankly, this is a skill which can be valuable to anybody who wants to be able to follow any news with statistical information or other uses of data and make sense of it.

Now, we are all living in the Covid-19 era. And for many of us in the public, the people we can trust the most with their statements are the ones who understand data and are able to present conclusions based on the statistical data, rather than on gut feel.  This is closely related to looking at news stories or public statements, and determining whether the information is evidence based, using techniques such as the scientific method and peer-based reviews, or anecdotal, and therefore not to be trusted.  Intuition can be very powerful, but not nearly as useful unless it is also combined with a data driven outlook for these types of challenges.

I teach an Introduction to Business course at Northeastern University and we have the students conduct surveys as part of their business projects.  Using survey and statistical tools such as those offered by Qualtrics, they take surveys and test conclusions on ideas for their business models.  The surveys carry much more weight for me if the survey size is at least 30 and ideally much more, and if the respondents have a demographic profile which fits the proposed target market for their products or services.  This is hardly rigorous statistical work, but it is much more valid, and convincing for a reader, than just stating opinions and not having any research to back it up.

So statistics and big data are having a moment. It’s a good reminder that certain skills, such as statistics, investment planning and effective written and oral communications, can offer value that goes well beyond the classroom and better equips all of us to be effective and informed citizens and consumers.  That’s why I encouraged both of my sons to take college level statistics courses and add this particular skill to their life toolkit.  So the next time you hear a news story or listen to a public figure, think about whether the opinions stated are backed up by data. It’s a basic skill from which we can all benefit.

Lean Six Sigma – Taking it Forward

This is the second post in a two part review of the discipline called Lean Six Sigma.  The first part of the discussion can be found here.

When I was in college at RPI, I segued from the core Engineering curriculum into a degree called Management Engineering. This degree had elements of Industrial Engineering, but also dove very deep into computers, statistics and operations research. As a result, graduates could pursue a variety of career paths including manufacturing, software development and various quantitative careers. I chose the software development direction, but also used the problem solving skills I’d learned. Later, a manager noticed those problem solving skills and offered me a position in operations management. I worked with teams to solve problems, organize processes and eliminate waste, but we did it on an ad hoc basis and had nothing like a Lean Six Sigma methodology to guide us. I’m proud of the work we did,but I soon got interested in products and moved into product management and R & D. In software project management, I tracked defects using databases and graphics, but never dove back into the statistics that I’d enjoyed so much in college.

I later shifted into product management for other products. In one particular case, we had a multi-million dollar customer who was very upset because the product process for an embedded voice mail system had fallen out of control. I was asked to solve the problem and took over program management for the product. I worked closely with our customer, manufacturing, sales and our quality department. We listened carefully to the customer and improved both the quality and efficiency of the product process. Within a year, the customer awarded our team a quality award in recognition of our progress. Once again, I’d worked with a team to solve problems, this time for an external customer. Our quality team used a number of statistical techniques to demonstrate our improved process quality and we used Pareto charts to identify and solve major problems. Sounds a lot like Lean Six Sigma.  We listened carefully to our customer and let them guide us on which problems were the most important to solve.

Fast forward to this year and my participation in this course. The cool thing about Lean Six Sigma for me is that is takes ALL of the skills I learned in my university studies, plus lots of hard earned learnings from different points in my career and weaves them together into a coherent methodology which is great for solving problems.  The review of statistics and other analytical tools in the course was an excellent refresher — I’d studied most of these techniques at RPI — and the techniques are highly relevant in today’s business environment. Analytics and quantitative analysis are hot in a wide variety of fields today, including politics, social media, medical devices, telecom and marketing. Companies like people with experience, but they like it even more if people can analyze data and use it to back up their ideas. The course also offered a variety of approaches for getting information from customers, including ideas on data driven approaches such as surveys and interviews. This ties well into contemporary marketing approaches where listening to the Voice of the Customer is critical and analytical tools such as A / B testing for new marketing campaign ideas are increasingly common.

In short, I’m really glad I took the Lean Six Sigma course. It’s equipped me with a useful philosophy for process and quality improvement and the tools we studied should be useful for numerous business situations. Lean Six Sigma. Check it out.

Lean Six Sigma – First Take

I just finished a two week course and now possess a certification known as the Lean Six Sigma Green Belt. I’d been running into a few people with Lean Six Sigma backgrounds while networking in the last several months, but didn’t really understand what it was all about until I took this course. I now have a much better appreciation for what I’ve been missing and am amazed by the degree to which this particular cluster of methodologies winds like a river through many different elements of my education and career.  

Lean Six Sigma is a combination of two movements. Lean is an approach to improving processes by analyzing and removing various types of waste. But that’s not all. It can also be used to assess a product or process and determine which elements provide value for customers. I’d been thinking Lean Six Sigma was just a manufacturing thing — a common misconception — but here they were talking about the customer value and the Voice of the Customer. So Lean is relevant to customers and therefore, might also be highly useful for people in marketing and product positions. Okay, so Lean is relevant for product and marketing people like me. What about Six Sigma?  

Six Sigma dates back to the Seventies, when Dr. Mikel Harry of Motorola put together a variety of quality and statistical approaches aimed toward helping organizations greatly improve the quality of their processes. The term Six Sigma derives from the statistical world, where sigma is another word for standard deviation. A six sigma process is highly accurate and produces on average only 3.4 defects per million. At one time, Six Sigma and Lean were separate movements, but organizations soon saw the value in using Six Sigma techniques to improve the quality of their processes and Lean to reduce wastes, eliminate unnecessary process costs and in general, have much more efficient processes.  

It turns out there’s a lot to learn. Green Belts get introduced to the smorgasbord of Lean and Six Sigma techniques, but true mastery of the tools takes more learning and experience — hence the use of the term Black Belt.  The overall Lean Six Sigma philosophy and collection of tools strikes me as being valuable for people in a wide variety of disciplines.  I’ll talk more about how Lean Six Sigma relates to my own background and today’s business needs in my next post.