How does your company's define PPM? I have a supplier who defines it as customer complaints divided by annual production volumes. A complaint is any communication from the customer where the customer is dissatisfied. It could be for one part that the customer is complaining about or a 100 parts. The complaint is only counted once. How does that definition compare to yours? For example,
180 complaints per year from the customers / 72,000 parts produced per year = 2500 ppm.

What bothers me about this supplier's definition is that major problem with defective batch is treated the same as a part in a batch that is defective.

PPM = PARTS Per Million. . . Period . . . Not Complaints Per Million Parts.

Sounds like someone not too versed in Quality Measures ( :confused: ) decided to make up a neat measure with their thumb print on it. Perhaps, for their modus operendi, this IS a meaningful measure.

This index (PPM) is a normalizing index that gives a common base of reference for all players. Change the components, and you change the frame of reference and meaning of the equation.

(Discrepent Parts/Total Parts) x 1,000,000

Per TS, your supplier is required to communicate by a means that is either your call or one agreed upon between you and the supplier.

IMHO, in this case, they can measure whatever they want for their internal purposes, but I think you have the say as to whether they reports to you in real PPM or another index.

Hope this is of help. :bigwave:

PPM = PARTS Per Million. . . Period . . . Not Complaints Per Million Parts.

Sounds like someone not too versed in Quality Measures ( :confused: ) decided to make up a neat measure with their thumb print on it. Perhaps, for their modus operendi, this IS a meaningful measure.

This index (PPM) is a normalizing index that gives a common base of reference for all players. Change the components, and you change the frame of reference and meaning of the equation.

(Discrepent Parts/Total Parts) x 1,000,000

Per TS, your supplier is required to communicate by a means that is either your call or one agreed upon between you and the supplier.

IMHO, in this case, they can measure whatever they want for their internal purposes, but I think you have the say as to whether they reports to you in real PPM or another index.

Hope this is of help. :bigwave:

Thanks. :bigwave: I was scratching my head as well when I heard the answer to how they measured PPM. It is a new measure -- CPM (complaints per million) :vfunny: I already put in a follow up phone call with the supplier regarding this and some other issues.

Thanks. :bigwave: I was scratching my head as well when I heard the answer to how they measured PPM. It is a new measure -- CPM (complaints per million) :vfunny: I already put in a follow up phone call with the supplier regarding this and some other issues.Appropos "creative definitions"
We were once the "supplier dictated by the customer" for a proprietary "black box" subassembly sent to his contract assembler. We had a screwup in that the end customer gave us an erroneous address for "ship to."

Within 2 hours of the promised delivery time, the assembler's VP of manufacturing was on the phone to my shipping clerk, saying, "We've filed a GRIEF with [end customer] about your failure to deliver."

I sent the vp a fax of the customer's purchase order showing the erroneous address and a copy of UPS's message saying they would have the package on his dock by the close of business the same day. His response:
"We've filed another GRIEF with [end customer] because you didn't complete and return a proper GRIEF form."

Turns out we learned two things that day:

A GRIEF is non-ISO, non-ASQ term for "corrective action request" created by some clever guy at this assembler because "they give me grief"
The assembler was looking to make us look bad because he made a competing product that was passed over by the end customer in favor of ours (hence the GRIEF for not completing a proper GRIEF form we still have not seen two years later)

I'm with Taz (and your inclination that something wasn't right). Your supplier is, more than likely, woefully understating their PPM value.

Perhaps, for their modus operendi, this IS a meaningful measure.
I haven't been able to see where the ratio presented could give any meaningful information. Perhaps if it were "No. of customer complaints/No. of customer orders" ????

Bill

The measure Bill stated is also a valid measure for internal use. . . and could be overly severe. Say you had four equal volume orders and one was rejected. . . that's a 25% failure rate. . . or 250,000 PPM (sorta). Not World Class by any means.

IMHO, the PPM normalized index is universally (almost) accepted and meaningful because it gives a rate of rejection of "product". . .not orders or complaints. It is also the index used by all of the big guys (Big 3).

I have been in the customer/competitor business before and it is . . .for lack of a better word, "interesting" to say the least. Took 2 years of solid work (and travel) to smooth waters and create a working relationship by yours truly.

Understanding customers' needs is key. They don't always know what they really want or need. But they ARE the customer. Help them, and you help yourself. (The same can be said for Bosses. . :biglaugh: )

Thanks for expanding on the topic, but the message seems to be more about how people interpret or define a concept. I have scheduled an all day on site visit with the supplier to review their process and documentation to get a better understanding of how they operate. By the way, this supplier is not a problem but we are in the initial phases of launching a new product line of which their components are key.

With regard to varied definitions of what is thought to be common universal concept is not always as universal as we think. We all have our defintiions. It is good to get an operational definition. For example, I had one supplier that was assembling a component that required four bolts to be installed (two at each end) to complete a fairly straightforward 3 piece assembly. The joints between the parts were adhered and sealed with some very aggressive 3M two-sided tape that made the assembly look like it was bolted together. The bolts were hidden and you could not tell if they were installed unless you looked inside the blow molded part through a very small access hole. Unfortunately, assembling without the bolts was a Hazard without Warning if the parts separated under load. My supplier said they had inspection in place to prevent this. This was a human operation and the person doing the assembly was self-inspecting. Unfortunately the lack of bolts was not easily detected. We had to perform a 100% field inspection to make sure all assemblies that were not bolted together were contained and replaced at our customer location. In hindsight, using my supplier's interpretation of inspection of would have required triple inspection or challenged my designers to error proof the design.

Sorry to drag up an old thread, but I just found it during a search for something unrelated.

My understanding from someone I attended a training course with is that Honda calculates PPM as parts per million dollars worth of product. That's real cute, because say your product mix includes one item worth $500,000 (hey, it's for McLaren or something, OK?) and one item worth $1.

Then say for both items, you ship 100% bad parts. For the expensive item, your PPM is 2 and for the cheap item, your PPM is a million.

So, this PPM$ doesn't tell you anything! 2 PPM? That doesn't sound too bad! Never mind the fact that you just sent them $1M worth of bad parts, and probably shut down their line.

Anyway, excuse the rant - can anyone verify this for me or is this an urban quality legend?

I really don't have any solid facts on this but I would think it is an "urban legend". Honda has had good systems in all our dealings and the one you describe makes no sense to me at all. I seriously doubt that Honda would come up with it. With some of our parts costing $0.001, I could send an awful lot of bad parts before reaching 1 PPM.

Dave

HAving worked at Honda in the area of shipped vehicle quality I can say that that definition was never used While I was there.

However, it is possible that it is now used as an adjunct Metric (not a primary, unless things have really changed there). I can see Honda using it to help prioritze projects by financial impact...(and by extension the different segments from teh base Civic to the top of the line Acuras...)

However, I don't see it being a primary and definitely not a solitary metric. Honda is well aware that a $.02 part can cause mission failure as well as a $1,000 part...

Let's say I ship 1M items per year to an automotive assembly line. Since I 100% test the electronics, I get 5 rejects from the line per year at plug in, turn on(5 PPM, yeah?)

So, the vehicles go out and get beat up by the end user. Over the two year warranty period, I get 5,000 warranty claims for replacement. (5,000 PPM, right?). But wait, during the 2 year period, I've fielded 2M parts, so 2,500PPM, ok? Maybe not.

I tend to view PPM as an assembly line reject measure. Fielded returns (warranty) fall into a reliability calculation for me, mean time to failure or mean time between failures, failure rate, etc. Obviously, line side rejects will be much lower than defective product in the field after 2 years of wear and tear.

Where do I measure PPM?

Since this thread was resurrected and I passed on it the first time around, I'll take the opportunity to make a blanket complaint about the concept of PPM in general.

It seems to be that unless you're actually making a million of something, the method flies in the face of good statistical sense. Let's say that we have reliable data to indicate that a given process will likely yield a PPM value of 50, and that number is acceptable to everyone involved. Now let's say that in my first shipment of 1000 parts there are 20 defectives. Given those numbers, the customer might complain that our PPM level is an unacceptable 20,000. But I say that I've verified that my process is in control (i.e., it's statistically stable) and that the idea of randomness in probability tells us that if the expected value is 50 defectives in 1mm parts, we have no basis for assuming that the 50 defectives--if in fact that prediction comes true--will be evenly distributed over the chronology of the manufacture of 1mm parts. We could, at least in theory (and that's what PPM is all about) have 20 defectives in our first 1000 and then not have another one in the ensuing 1,999,000 pieces, which would mean that what the customer has defined as a 20,000 PPM level is really 20 in practical terms.

I personnally the most effective way to measure PPMs internally and externally is in the form of DPMO (defects per million opportunities) which then can be used to calculate the process sigma.

For example, internally a DPMO will effectively show you how good your process are:

Take an injection Moulding that goes through an assembly line that has say, 10 value added process being put into it, If you make a Million parts and 100 were scrapped off at the first step then the DPMO rating would be 10,000. On the other hand if you had ten parts out of a million being scrapped off at the 10th step then the DPMO rating would be 100,000 Hence highlighting where you should focus.

Take an injection Moulding that goes through an assembly line that has say, 10 value added process being put into it, If you make a Million parts and 100 were scrapped off at the first step then the DPMO rating would be 10,000. On the other hand if you had ten parts out of a million being scrapped off at the 10th step then the DPMO rating would be 100,000 Hence highlighting where you should focus.

I admit that I'm not a six-sigma expert (my pants keep falling down because I have no belt) but this doesn't sound right to me. If there were 100 scrapped in the first operation, the DPMO (or also PPM, in this case would be 10,000, but only for that operation, no? By the same token, how does the DPMO grow to 100,000 when there have been nine prior operations with no defects? What am I missing?

The problem with DPMO is that it tells you nothing about your process. As the examples show, it is a point in time calculation of the defects that can be determined a number of ways depending on how you define an "opportunity". Even if you settled on a definition, the defects could be part of the process as common cause requiring corrective action or it could be from special causes that may require no action.

It would be better if the Six Sigma black belts returned to the basics of statistical analysis (including control charts) of the process data rather than calculating DPMO.

Just my opinion.

Bill Pflanz
(ASQ CSSBB)

One way of saying how DPMO Works:

What would you rather have, Parts scrapped off at the first stage of the process, or Parts scrapped off after they have had say 9 value added processes go into it which would mean rework or even disposal.

Are you using your PPM for anything else than a comparative reference to what your customer reports your PPM as?
Do it the same as your customer.

I was asked by the staff to define what a customer complaint would be as recordable.

My initial responce was anything that would cause additional cost to the customer.

Any comments on this topic?

PPM stands for Parts Per Million. What kind of parts? Good? Bad? With one defect? With multiple defects? DPPM before inspection? After inspection? Before test? After test? Internal? At one customer? At all customers?

PPM only defines a ratio of how many occurrences there have been if there were a million opportunities. But occurences of what?

I think most on this thread are speaking of DPPM. D = a part with at least one defect. PPM by itself is simply a ratio. We need to define what it is that we want to count per million.

If people believe there is only one way to count "PPM", and that everyone counts it the same, you are kidding yourself.

Defective parts per million? Defects per million opportunities? Defects and defective parts are different things. And at what stage in the process?

Where one measures this can make a huge difference. If someone is trying to convince you of there product performance with an internal "PPM" measure, we need to know from where in the process they have taken the measure. For example, a DPPM measure might be dramtically different before or after a 100% electrical test for electical parts.

When discussing particles suspended in a fluid, we could measure those "parts" in different ways - size, mass, density, weight, or any other characteristic.

What is it that is being counted and where in the process?

PPM by itself only indicates a ratio. It doesn't tell you anything more than that. What per a million, where, how measured, how was the data collected?

Regards,

Dirk

I was asked by the staff to define what a customer complaint would be as recordable.

My initial responce was anything that would cause additional cost to the customer.

Any comments on this topic?

I would think that if the customer takes time to complain, it should be a "recordable event." You might have categories to address those compaints that end up being inappropriate. But if they took time to complain, you should record it as a starting point.