Economic design of a nonparametric control chart for shift in location

Abstract

Most control charts economically designed rely on the assumption of normality or some specific process distribution. However, when identifying a specific distribution is not possible or unlikely as full knowledge is not available in practice, the economic effectiveness of conventional charts is very likely to be heavily discounted. In this paper, an economic model based on the Duncan-type cost function is researched on, which is applied to design a nonparametric sign chart to monitor the location parameter of a univariate process. Numerical results show that the proposed design performs fit well for various continuous distributions.