Quality and Reliability Engineering International

Statistical Efficiency: The Practical Perspective

Journal Article


The idea of adding a practical perspective to the mathematical definition of statistical efficiency is based on a suggestion by Churchill Eisenhart who, years ago gave, in an informal ‘Beer and Statistics’ seminar, a new definition of statistical efficiency. Later Bruce Hoadley from Bell Laboratories picked up where Eisenhart left off and added his version nicknamed ‘Vador’. Blan Godfrey, former CEO of the Juran Institute, more or less used Hoadley's idea during his Youden Address at the Fall Technical Conference of the American Society for Quality Control. We expand on this idea adding an additional component, the value of the data actually collected, which we believe is critical to the overall idea. The concept of Practical Statistical Efficiency (PSE) derived from these developments is introduced and demonstrated using five case studies. We suggest that PSE be considered before, during and after undertaking any quality improvement projects. Copyright © 2003 John Wiley & Sons, Ltd.

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