Integration of Taguchi's loss function in the economic design of (x)over-bar-control charts with increasing failure rate and early replacement

In this paper, Taguchi's quadratic loss function is incorporated in the economic design of the control chart. This is done by redefining the in-control and out-of-control costs using Taguchi's loss function in the general model for the economic design of (x) over bar -control charts developed by Banerjee and Rahim [1]. Both cases of increasing hazard rate (Weibull failure rate) and constant hazard rate (exponential distribution) will be presented and followed by numerical examples. Finally, sensitivity analysis is conducted to study the effect of important parameters on the cost. Suggestions for further research are also included.