Bayesian EWMA control chart with measurement error under different loss functions

Abstract

AbstractThis paper presents the Bayesian EWMA control chart under two different loss functions (i) squared error loss function (SELF) and (ii) linex loss function (LLF) in the presence of measurement error (ME). We take posterior and posterior predictive distribution under the conjugate prior. We used a linear covariate model in the existence of ME to evaluate the control chart. We also studied the effects of multiple measurements and linear increasing variance methods in the existence of the ME. The average run length and standard deviation of run length are used to measure the performance of the Bayesian EWMA control chart with ME. We conducted the Monte Carlo simulation study to evaluate the performance of Bayesian EWMA control chart with ME. A real‐life data example is also presented to demonstrate the application of the control chart.