Performance Metrics

Topics: Management, Supply chain management, Process management Pages: 9 (2896 words) Published: August 23, 2013
. Performance Metrics:  purpose
What are the ways you can measure how successful your Six Sigma project has been in improving quality or decreasing the number of defects? Before we go into the metrics and definitions, let’s say what “defects” and “defective” mean. Something has a defect if the result or outcome of a process is not what is expected. Something went wrong. The product may still be usable: a car with chipped paint can still be driven. So some engineers use “defective” to mean a product which is not usable. Oops, we forgot to put an engine in that car: well, that’s a defective car because it can’t be driven. However, for the purpose of quality control, “defective” simply means “contains a defect,” whether that defect is cosmetic or whether it actually affects the function of the part as intended. (So just be careful to make sure you are on the same page in terms of your definition as those you are communicating to). There can be different types of defects in a single part based on different causes. B. Performance Metrics–Definitions

Here is a list of the Performance Metrics which are spelled out and then given an acronym if one is commonly used. The description is given of what this metric means. | Performance Metric| Description|

1.| Percentage Defective| What percentage of parts contain one or more defects?| 2.| Parts per Million (PPM)| What is the average number of defective parts per million? This is the same figure in metric 1 above of “percentage defective” multiplied by 1,000,000.| 3.| Defects per Unit (DPU)| What is the average number of defects per unit?| 4.| Defects per Opportunity (DPO)| What is the average number of defects per opportunity? (where opportunity = number of different ways a defect can occur in a single part| 5.| Defects per million Opportunities (DPMO)| The same figure in metric 3 above of defects per opportunity multiplied by 1,000,000| 6.| Rolled throughput yield (RTY)| The yield stated as a percentage of the number of parts that go through a multi-stage process without a defect.| 7.| Process sigma| The sigma level associated with either the DPMO or PPM level found in metric 2 or 5 above.| 8.| Cost of poor quality| The cost of defects: either internal (rework/scrap) or external (warranty/product)| C.  Performance metrics–Discussion and examples

1. Percentage Defective
This is defined as the
(Total number of defective parts)/(Total number of parts) X 100 So if there are 1,000 parts and 10 of those are defective, the percentage of defective parts is (10/1000) X 100 = 1% 2. PPM
Same as the ratio defined in metric 1, but multiplied by 1,000,000. For the example given above, 1 out of 100 parts are defective means that 10,000 out of 1,000,000 will be defective so the PPM = 10,000. NOTE: The PPM only tells you whether or not there exists one or more defects. To get a clear picture on how many defects there are (since each unit can have multiple defects), you need to go to metrics 3, 4, and 5. 3. Defects per Unit

Here the AVERAGE number of defects per unit is calculated, which means you have to categorize the units into how many defects they have from 0, 1, 2, up to the maximum number. Take the following chart, which shows how many units out of 100 total have 0, 1, 2, etc., defects all the way to the maximum of 5. Defects| 0| 1| 2| 3| 4| 5|

# of Units| 70| 20| 5| 4| 9| 1|
The average number of defects is DPU = [Sum of all (D * U)]/100 = [(0 * 70) + (1 * 20) + (2 * 5) + (3 * 4) + (4 * 9) + (5 * 1)]/100 = 47/100 = 0.47 4. Defects per Opportunity
How many ways are there for a defect to occur in a unit? This is called a defect “opportunity”, which is akin to a “failure mode”. Let’s take the previous example in metric 3. Assume that each unit can have a defect occur in one of 6 possible ways. Then the number of opportunities for a defect in each unit is 6. Then DPO = DPU/O = 0.47/6 = 0.078333

5. Defects per Million Opportunities
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