Continuous performance metrics quality cost models

In Section IV we considered a categorical performance metric y. Although that represents a common practice, especially when y defines the quality of a product or process operation, there are many instances where system performance is measured by a continuous variable. Even when y is quality-related, it is becoming increasingly clear that explicit continuous quality cost models should be adopted and replace evaluations of performance based on categorical variables. 

This Section addresses cases with a continuous performance metric, y. We identify the corresponding problem statements and results, which are compared with conventional formulations and solutions. Then Taguchi loss functions are introduced as quality cost models that allow one to express a quality-related y on a continuous basis. Next we present the learning methodology used to solve the alternative problem statements and uncover a set of final solutions. The section ends with an application case study. 

Both situations with categorical and continuous, real-valued performance metrics will be considered and analyzed. Since Taguchi loss functions provide quality cost models that allow the different objectives to be expressed on a commensurate basis, for continuous performance variables only minor modifications in the problem definition of the approach presented in Section V are needed. On the other hand, if categorical variables are chosen to characterize the system s multiple performance metrics, important modifications and additional components have to be incorporated into the basic learning methodology described in Section IV. 

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