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Defects Per Million Opportunities (DPMO)

Defects per Million Opportunities factors in the total opportunities for defect occurrence existing in a process. DPMO is considered long-term measurement of a process and this can be directly converted into a long-term Z-statistic (sigma value) Given: D: # of defects O: # of opportunities for a defect U: # of units TOP: Total number of opportunities = U * O Formula:

DPMO = DPO * 1,000,000

NOTE: DPMO is NOT the same as PPM since it is possible that each unit (part) being appraised may be found to have multiple defects of the same type or may have multiple types of defects. A part is defective if it has one or more defects. The number of defectives can never exceed the number of defects. IF each part only has one characteristic that can be a defect, then DPMO and PPM will be the same. DPMO will always exceed or equal PPM for a given yield or sigma level of performance.

Example
Examine the table shown below: Nail #1 it has two types of defects. Therefore it is ONE defective nail that contains TWO defects.

SUMMARY OF TABLE D = 19 total defects O = 5 opportunities (categories of defect types) U = 10 nails TOP = U * O = 50 total opportunities DPU = D / TOP = 1.9 defects per unit DPO = 0.38 DPMO = 380,000 Out of a million opportunities, the long term performance of the process would create 380,000 defects

Using Excel to calculate Sigma and DPMO


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There are a couple commonly used Microsoft Excel functions that converts Defects per Million Opportunities (DPMO) to a process sigma (z-score) and vice versa. To convert from DPMO to process sigma: Process Sigma = NORMSINV * ( 1 -( DPMO / 1,000,000))+ 1.5 To convert from process sigma to DPMO: DPMO = 1,000,000 * ( 1 - ( NORMSDIST * (process sigma - 1.5 )) NOTE: A Six Sigma quality process refers to the process short-term performance or how it is performing currently when there are 3.4 DPMO. Over the long term, this six sigma process is estimated to shift -1.5 sigma (lower) and will perform at a 4.5 sigma level, which produces 1,350 DPMO. ----------------------------------------END-------------------------------------------------------

Defects per million opportunities


In process improvement efforts, defects per million opportunities or DPMO (or nonconformities per million opportunities (NPMO)) is a measure of process performance. It is defined as

A defect is defined as a nonconformance of a quality characteristic (e.g., strength, width, response time) to its specification. DPMO is stated in opportunities per million units for convenience: Processes that are considered highly-capable (e.g., processes of Six Sigma quality) are those that experience only a handful of defects per million units produced (or services provided). Note that DPMO differs from reporting defective parts per million (PPM) in that it comprehends the possibility that a unit under inspection may be found to have multiple defects of the same type or may have multiple types of defects. Identifying specific opportunities for defects (and therefore how to count and categorize defects) is an art, but generally organizations consider the following when defining the number of opportunities per unit:

Knowledge of the process under study Industry standards When studying multiple types of defects, knowledge of the relative importance of each defect type in determining customer satisfaction
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The time, effort, and cost to count and categorize defects in process output

Other measures of process performance include:


Process capability indices such as Cpk Natural tolerance limit or sigma level PPM defective Process performance indices such as Ppk Quality costs or cost of poor quality (COPQ)

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DPMO
The term DPMO or defects per million opportunities is one of the important six sigma metrics. This value allows you to determine how effective your process is. It also allows for a comparison between processes. Similar to PPM or parts per million, DPMO provides a more in depth look at process effectiveness. PPM is a calculation where each individual output is considered one opportunity. Consider it to be almost the same as a first time pass percentage. The main issue with using PPM is that it is unfairly weighted toward high volume production activities. Lower volume processes are adversely affected by a single reject. In the following example we'll show you how this happens. PPM is calculated using the equation (D/U)* 106, where D= the number of defectives, U= the number of units produced. If the process had 300 defectives in a month and 100,000 units were produced, the PPM would be (300/100,000)* 106, or 3000 PPM. If the same process exhibits 400 defectives the following month, the PPM for that month would be 4000, an important and statistically significant increase. Suppose a different process produced 5000 units per month, and had 300 and 400 defectives over the past 2 months. The PPM for the first month would have been 60,000, and the second month would have been 80,000! At first glance it appears that the second process is in dire need of improvement. The first process also appears to be in need of improvement as well, but the second process definitely appears to be worse than the first. This, however, may not be the truth. PPM, while a decent metric, fails to account for the complexity of a process. It is unreasonable to assume the ability to compare two different

processes without finding a way to equalize them. This is where defects per million opportunities come into play.

How Six Sigma DPMO Works


The defects per million opportunities metric accounts for this process complexity by factoring in the number of value-added opportunities in the process. In other words, how many process steps actually add value to the end product? A value-added step is one that the customer is willing to pay for.

NOTE Adding non-value added steps into the defects per million opportunities equation is a very bad idea. Do not make your processes appear to be better than they are! This is called Gaming the Process.

The equation for defects per million opportunities is very similar to the equation for PPM, but now we're adding the number of opportunities into the equation. DPMO= (D/(U*N))* 106, where D= Number of Defectives U= Number of Units Produced N= Number of Opportunities for Errors per Unit Using the same information from the example, we'll now show how the DPMO metric is much more valuable than PPM. From the previous example we'll also add the number for opportunities for mistakes to be made: Process #1 o Month 1 defectives- 300 o Month 2 defectives- 400 o Units produced- 100,000 o Opportunities per Unit- 2 Process #2 o Month 1 defectives- 300 o Month 2 defectives- 400 o Units produced- 5,000 o Opportunities per Unit- 200

Inserting the values for process #1 into the DPMO equation shows (300/(100,000*2))* 106= 1500 While process #2 shows (300/(5000*200)* 106= 300

This clearly shows how important it is to understand process complexity when making decisions regarding which process actually needs to be improved first. At first glance process #2 looked like the most likely candidate for improvement, yet in actuality it was process #1 showing a much larger defects per million opportunity value.

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